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Practical Manual of Companies 2022.

Deduction for investments in Spanish cinematographic productions

Regulation: Articles 36.1 LIS and 94 Law 20/1991 and DA 14 Law 19/1994

  • To apply the deduction for investments in Spanish productions of feature films and audiovisual series of fiction, animation or documentaries, which allow the preparation of a physical support prior to their serial industrial production carried out in the Canary Islands, entities must comply with the general requirements established for these deductions in article 36.1 of the LIS .

  • Percentages

    The deduction percentages established in article 36.1 of the LIS will increase according to the provisions of article 94.1 a) of Law 20/1991. For these purposes, the following percentages will be applied:

    • The 54 percent with respect to the first million base of the deduction (the greater of: 30% x 1.8 = 54% or 30% + 20% = 50%). This 54 percent percentage may be applied provided that the aid intensity does not exceed 50 percent of the eligible costs , in the terms established by article 54 of Commission Regulation ( EU ) No. 651/2014, of June 17, 2014, declaring certain categories of aid compatible with the internal market in application of Articles 107 and 108 of the Treaty.

    • 45 percent on the excess of said amount (the greater of 25% x 1.8 = 45% or 25% + 20% = 45%)

  • Limits

    The limits applicable to this deduction will increase in accordance with the provisions of article 94.1.b) of Law 20/1991 , therefore will be subject to the joint limit of 60/90 or 70/100 (La Palma, La Gomera and El Hierro) percent.

    In addition, Additional Provision fourteenth of Law 19/1994 establishes, with effect for tax periods beginning on or after January 1, 2021, a specific limit for this deduction, indicating that its amount cannot be higher than the result of increasing by 80 percent the maximum amount included in article 36.1 of the LIS, when deals with productions made in the Canary Islands. Therefore, the maximum amount of this deduction will be 18 million euros (10 million euros x 1.8).