Differences between accounting and tax depreciation

Article 12.1 of the LIS establishes that the amounts that, in the concept of amortization of tangible and intangible fixed assets and real estate investments, correspond to the effective depreciation suffered by the different elements due to operation, use, enjoyment or obsolescence, are deductible. And the depreciation will be considered effective when:

1. Let the result of applying the coefficients of linear amortization established in the following table:

   Element type		Linear coefficient maximum	Period of years maximum
   Civil engineering work	General civil engineering work	2 per 100	100
   	Pavements	6 per 100	34
   	Infrastructure and mining works	7 per 100	30
   Power plants	Hydroelectric power stations	2 per 100	100
   	Nuclear power plants	3 per 100	60
   	Coal plants	4 per 100	50
   	Renewable power plants	7 per 100	30
   	Other power plants	5 per 100	40
   Buildings	Industrial buildings	3 per 100	68
   	Land dedicated exclusively to waste dumps	4 per 100	50
   	Stores and deposits (gases, liquids and solids)	7 per 100	30
   	Commercial, administrative and services buildings and dwellings	2 per 100	100
   Facilities	Substations. Transport and power distribution networks	5 per 100	40
   	Cables	7 per 100	30
   	Other facilities	10 percent	20
   	Machinery	12 per 100	18
   	Medical and similar equipment	15 per 100	14
   Transport features	Trains, carriages and traction equipment	8 per 100	25
   	Ships, aircrafts	10 percent	20
   	Internal transport elements	10 percent	20
   	External transport elements	16 per 100	14
   	Dumper trucks	20 per 100	10
   Furniture and fittings	Furniture	10 percent	20
   	Lingerie	25 percent	8
   	Glassware	50 percent	4
   	Chattels and tools	25 percent	8
   	Moulds, patterns and models	33 per 100	6
   	Other household goods	15 per 100	14
   Electronic and computer equipment. Systems and programs	Electronic equipment	20 per 100	10
   	Computer equipment	25 percent	8
   	Systems and computer programs	33 per 100	6
   Film productions, phonographic productions, videos and audiovisual series		33 per 100	6

   The coefficients and periods provided for in this letter may be modified by regulation or additional coefficients and periods may be established.

2. Let it be the result of applying a certain constant percentage on the pending amortization value.

   The constant percentage will be determined by weighting the linear amortization coefficient obtained from the amortization period according to officially approved amortization tables, by the following coefficients:

   • 1.5, if the item has an amortization period of less than 5 years.
   • 2, if the item has an amortization period equal to or greater than 5 years and less than 8 years.
   • 2.5, if the item has an amortization period equal to or greater than 8 years.

   The constant percentage may not be less than 11 percent.

   Buildings, furniture and fixtures may not be subject to depreciation using a constant percentage.

3. Let the result of applying the digit number method be . This method is not acceptable for buildings, furniture and fixtures.

4. It conforms to a plan formulated by taxpayer and accepted by the tax authority.

5. Taxpayer justifies his amount .

Filling in form 200

In application of the provisions of this precept, the following adjustments must be made in boxes [ ] and [00304] "Differences between accounting and tax amortization (art. 12.1 LIS)" on page 12 of form 200:

• When the accounting amortization carried out in the fiscal year by the taxpayer for any of the concepts referred to in article 12.1 of the LIS is greater than the fiscally admissible amortization as established in said sections, the amount of this difference must be recorded as excess in box [00303] of increases. Likewise, when the element is amortized in the accounting records in subsequent tax periods, the amount of said difference must be recorded in box [00304] of decreases, as a result of the reversal of the positive adjustment, based on tax amortization.

• And in the event that the tax-admissible amortization is greater than the accounting amortization made by the taxpayer for the aforementioned concepts (and it is not the case of an accounting error), the amount of the corresponding difference must be recorded in box [00304] of decreases. Likewise, when the element is fiscally amortized in subsequent tax periods, the amount of said difference must be recorded in box [00303] of increases, as a result of the reversal of the negative adjustment, based on the accounting amortization.