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Practical Manual of Companies 2022.

Deductible financial expenses

Net financial expenses will be deductible with the limit of 30 percent of the operating profit for the year.

For these purposes, the following must be taken into account:

  • net financial expenses will be understood as the excess of financial expenses with respect to the income derived from the transfer to third parties of own capital accrued in the tax period, excluding those non-deductible expenses to which they refer. letters g) and h) of article 15 of the LIS and article 15 bis of said Law.

  • The operating profit will be determined from the operating result of the profit and loss account for the year determined in accordance with the Commercial Code and other development accounting regulations:

    • Eliminating the amortization of fixed assets, the allocation of subsidies for non-financial fixed assets and others, the impairment and results from disposals of fixed assets, and

    • Adding the financial income from participations in equity instruments, provided that they correspond to dividends or participation in profits of entities in which, either the percentage of participation, direct or indirect, is at least less 5 percent, except that said participations have been acquired with debts whose financial expenses are not deductible by application of article 15 h) of the LIS.

      Keep in mind:

      With effect for tax periods beginning on or after January 1, 2021, the addition of financial income from participations in securities instruments will not be taken into account in the determination of operating profit assets that correspond to dividends, when the acquisition value of said shares is greater than 20 million euros , without reaching the aforementioned percentage of 5 percent.