Temporary negative adjustments originating in the financial year

In the event that the taxpayer has to make a correction to the result of the Profit and Loss Account that entails a temporary negative correction originating in the year to the accounting result, when completing the corresponding box on pages 12 and 13, the breakdown table "Details of corrections to the result of the profit and loss account (excluding the correction for Corporate Tax)" on page 20 bis of form 200 will be displayed simultaneously in the Sociedades WEB form. This information, once completed, will be grouped in the detail table contained on pages 26 bis to 26 sexies of form 200.

In this case, the box corresponding to "Temporary decreases in c corrections originating in the fiscal year" in the section of the table dedicated to "Corrections for the fiscal year" must be completed. Likewise, the box for Future increases of Temporary corrections in the column corresponding to "Outstanding balance at the end of the year" must be completed. The reason is that, although it is a negative adjustment at origin, will reverse through positive extra-accounting adjustments, this means that this negative temporary correction originating in the fiscal year will entail future increases in the tax base , therefore, in the column "Pending balance at the end of the fiscal year", the column of Future increases must be completed, in such a way that year after year the balance increases if the adjustment continues to be at origin or decreases, if that adjustment has begun to reverse, but always in the column of Future increases . Once the first tax period in which the adjustment is made has elapsed, in the following settlements the future increases box in the "Pending balance at the end of the year" column must be completed for the same amount that was entered in the Future increase box in the "Pending balance at the end of the year" column of the settlement for the previous tax period.

For all the above, during the tax periods in which the correction originates in the fiscal year itself, in the part of the table corresponding to the "Pending balance at the end of the fiscal year" the box for Future increases of Temporary corrections will increase its value with respect to the Balance of the previous fiscal year by the amount of the positive correction for this fiscal year. Thus, the " Outstanding balance at the end of the year" will reflect the total amount pending reversal in subsequent years through positive extra-accounting adjustments.

Example:

Public limited company "D", which in 2023 meets the requirements for the application of tax incentives for small companies, acquires a computer, which will be made available and put into operation on 1 July 2023, all for an amount of 6,000 euros. The residual value of the item is estimated to be insignificant, so the amortizable value coincides with the acquisition price.

The company decides to amortize the computer based on its estimated technical depreciation, which is the result of applying a coefficient of 25 percent. The entity also decides to carry out the tax-deductible amortization of the computer by applying the multiplying coefficient of 2 referred to in article 103 of the LIS .

The financial year of the entity coincides with the calendar year. The tax-deductible amortization in fiscal year 2023 will be as follows:

Maximum coefficient applicable to the computer according to the officially approved amortization tables: 25%.
Application of the multiplying coefficient: 2 x 25% = 50%.
Accelerated amortization practiced: 6.000 x 6/12 ⁽¹⁾ x 50% = 1,500 euros.

^{Note 1)} Amortization is carried out from the date the amortizable item comes into operation, in this case, July 1, 2023. Therefore, in this exercise, said amortization must refer to that carried out in six months of the year 2023 of the LIS. ^(Back)

The accounting amortization carried out by Company "D" in the year 2023 will be as follows:

6.000 x 6/12 ⁽²⁾ x 25% = 750 euros

^{Note (2)} Amortization is carried out from the date the amortizable item comes into operation, in this case, July 1, 2023. Therefore, in this exercise, said amortization must refer to that carried out in six months of the year 2023 of the LIS. ^(Back)

Decrease in the profit and loss account result to be recorded in box [00314]: 1,500 - 750 = 750 euros

Therefore, in the fiscal year 2023 and following , the corrections to be made in the boxes [00313] and [00314] «Small companies: accelerated amortization (art. 103 LIS and DT 28 LIS)» on page 13 of form 200 will be:

Financial year	Tax amortization	Accounting amortization	Corrections		Form 200	Balance at the end of the year
Financial year	Tax amortization	Accounting amortization	+	-	Form 200	Balance at the end of the year
2023	6,000 x 0.5 x 50% = 1,500	6,000 x 0.5 x 25% = 750	---	750	[00314]	750
2024	6,000 x 50% = 3,000	6,000 x 25% = 1,500	---	1,500	[00314]	2.250
2025	Remaining asset value = 1,500	6,000 x 25% = 1,500	---	---	---	2.250
2026	---	6,000 x 25% = 1,500	1,500	---	[00313]	750
2027	---	Remaining asset value = 750	750	---	[00313]	0

Total tax amortization = 1,500 + 3,000 + 1,500 = 6,000

Total accounting depreciation = 750 + 1,500 + 1,500 + 1,500 + 750 = 6,000

In the WEB Companies form, in the fiscal year 2023 when box [00314] is to be filled in, the table on page 20 bis of form 200 will be displayed and the box for Decreases of « Temporary corrections originating in the fiscal year» of the part of the table dedicated to «Corrections of the fiscal year» must be filled in for an amount of 750 euros. The form will transfer the completed information to box [03197] "Temporary (originating in the fiscal year)" on page 26 quinquies of form 200. Likewise, in the table on page 20 bis, the part corresponding to " Outstanding balance at the end of the year" must be completed, as we are dealing with a negative adjustment at source , the box for Future increases of Temporary corrections for an amount of 750 euros must be completed, because this negative temporary difference at source will be reversed through positive extra-accounting adjustments and will entail future increases in the tax base. The form will transfer the completed information to box [03195] "Outstanding balance at the end of the fiscal year" on page 26 quinquies of form 200.

Detail of the corrections to the profit and loss account result (excluding the correction for the IS ) (page 20 bis of form 200)

Exercise 2023 tax corrections	Outstanding balance at beginning of fiscal year		Exercise corrections		Outstanding balance end of fiscal year
Total	---	---	---	750	750	---
Exercise 2023 tax corrections	Future increases	Future decreases	Increases	Decreases	Future increases	Future decreases
Permanent corrections	---	---	---	---	---	---
Temporary corrections with origin in the fiscal year	---	---	---	750	750	---
Temporary corrections with origin in previous years	---	---	---	---	750	---

Table of details of corrections to the profit and loss account result (excluding the correction for IS) (page 26 bis to 26 sexies of form 200)

Detail of settings	Type	Outstanding balance at the beginning of the fiscal year	Exercise corrections			Outstanding balance at the end of the fiscal year
Detail of settings	Type	Outstanding balance at the beginning of the fiscal year	Permanent	Temporary (origin in the fiscal year)	Temporary (origin in previous exercises )	Outstanding balance at the end of the fiscal year
Small companies: accelerated amortization (art. 103 LIS and DT 28 LIS)	INCREASE	---	---	---	---	[03195] 750
Small companies: accelerated amortization (art. 103 LIS and DT 28 LIS)	DECREASE	---	---	[03197] 750	---	---

In the fiscal year 2024 :

Accelerated amortization practiced: 6,000 x 50% = 3,000 euros.
The accounting amortization carried out by Company "D" in the year 2024 will be as follows: 6,000 x 25% = 1,500 euros

Decrease in the profit and loss account result to be recorded in box [00314]: 3,000 – 1,500 = 1,500 euros

In the WEB Companies form, in the fiscal year 2024 , this adjustment will continue to be a temporary correction originating in fiscal year , therefore, in the same way as in 2023, when box [00314] is to be filled in, the table on page 20 bis of form 200 will be displayed and the Decreases box of « Temporary corrections originating in the fiscal year» of the part of the table dedicated to «Corrections of the fiscal year» must be filled in for an amount of 1,500 euros. The form will transfer the information to box [03197] “Temporary (originating in the fiscal year)” on page 26 quinquies of form 200.

Likewise, in the table on page 20 bis, the part corresponding to " Outstanding balance at the beginning of the year" must be completed. Since we are dealing with a negative adjustment at source , the Future increases box of Temporary corrections must be completed for an amount of 750 euros since this is the value of the future increase box in the column " Outstanding balance at the end of the year" of year 2023.

Regarding the part corresponding to " Outstanding balance at the end of the year" , since it is a negative adjustment at source, the box for Future increases of Temporary corrections must be completed because this negative temporary difference at source will be reversed through positive extra-accounting adjustments and will entail future increases in the tax base. The amount of the aforementioned box will be 2,250 euros (750 + 1,500), which is the accumulated balance for 2023 and 2024. The form will transfer the information to box [03195] "Outstanding balance at the end of the fiscal year" on page 26 quinquies of form 200.

Detail of corrections to the profit and loss account result (excluding the correction for IS) (page 20 bis of form 200)

Exercise 2024 tax corrections	Outstanding balance at beginning of fiscal year		Exercise corrections		Outstanding balance end of fiscal year
Total	750	---	---	1,500	2.250	---
Exercise 2024 tax corrections	Future increases	Future decreases	Increases	Decreases	Future increases	Future decreases
Permanent corrections	---	---	---	---	---	---
Temporary corrections with origin in the fiscal year	750	---	---	1,500	2.250	---
Temporary corrections with origin in previous years	750	---	---	---	2.250	---

Table of details of corrections to the profit and loss account result (excluding the correction for IS) (page 26 bis to 26 sexies of form 200)

Detail of settings	Type	Outstanding balance at the beginning of the fiscal year	Exercise corrections			Outstanding balance at the end of the fiscal year
Detail of settings	Type	Outstanding balance at the beginning of the fiscal year	Permanent	Temporary (origin in the fiscal year)	Temporary (origin in previous exercises )	Outstanding balance at the end of the fiscal year
Small companies: accelerated amortization (art. 103 LIS and DT 28 LIS)	INCREASE	[03194] 750	---	---	---	[03195] 2.250
Small companies: accelerated amortization (art. 103 LIS and DT 28 LIS)	DECREASE	---	---	[03197] 1,500	---	---