Practical examples
Example 1
Company "A" has made the following donations to the same foundation to which the special regime provided for in Law 49/2002 applies:
In fiscal year 2024, can company "A" apply the increased percentage established in article 20 of Law 49/2002 to the deduction base?
Solution:
Case a) Application of the regulations in force before January 1, 2024
With effect for tax periods beginning before January 1, 2024, the second paragraph of article 20 of Law 49/2002 establishes that the increased deduction percentage will be applied if, in the two immediately preceding tax periods, donations, gifts or contributions entitled to deduction have been made to the same entity for an amount equal to or greater, in each of them, than that of the previous tax period.
According to the above, in fiscal year 2024, company "A" must take into account the amounts donated in fiscal years 2022 and 2023, but also those made in fiscal year 2021, to the extent that the rule requires that in the two immediately preceding tax periods, donations had been made to the same entity for an amount equal to or greater than that of the previous tax period (in this case, with respect to 2022, the donations made in the previous fiscal year, i.e., 2021, would have to be analyzed).
Therefore, since company "A" did not make any donations in fiscal year 2021, in fiscal year 2024 it will not be able to apply the increased percentage to the donation made in that fiscal year.
Regarding the donation made in fiscal year 2024, the increased rate does not require that it be higher than the one made in 2023 to apply.
Case b) Application of the regulations in force as of January 1, 2024
By virtue of the modification made for tax periods commencing on or after January 1, 2024, the second paragraph of article 20 of Law 49/2002 establishes that the increased deduction percentage will be applied if in the two immediately preceding tax periods, donations, gifts or contributions entitled to deduction have been made in favor of the same entity, the amount of the donation, gift or contribution of this tax period and that of the previous tax period, being equal to or greater, in each of them, than that of the immediately preceding tax period.
According to the above, in fiscal year 2024, company "A" may apply the deduction for donations with an increased percentage if in 2022 and 2023 it had made donations to the same entity. In addition, the amounts donated in the years 2022, 2023, and 2024 must be taken into account, since the regulation requires that the amount of the donation made in 2024 and 2023 be equal to or greater, in each case, than that made in the immediately preceding year.
Therefore, although company "A" has made donations in the years 2022, 2023 and 2024, since in the year 2024 the amount of the donation made (1,300 euros) is not equal to or greater than the amount made in the year 2023 (1,500 euros), in the year 2024 it will not be able to apply the increased percentage to the donation made in said year.
In this way, with the regulations in force for tax periods starting from January 1, 2024, the number of exercises is reduced from four to three yearsduring which the donor must make donations to the same entity for an amount equal to or greater than that of the immediately preceding year, in order to access the increased percentage. Therefore, in order to apply the increased percentage in fiscal year 2024, company "A" must make donations to the same entity during three fiscal years (2024, 2023 and 2022) and not during four fiscal years (2024, 2023, 2022 and 2021) as required by the previous regulations.
In addition to the above requirement, under the new regulations, in order to apply the increased percentage, company "A" must have made a donation in fiscal year 2024 for an amount equal to or greater than that made in 2023. Let us remember that, with the application of the previous regulations, it was not required that the amount of the donation made in the year in which the deduction was applied (2024) be equal to or greater than the previous year (2023).
Example 2
Keep in mind:
In solving this example, the modifications to the percentages and limits made by the Royal Decree-Law 6/2023, of December 19 with effect for tax periods beginning on or after January 1, 2024.
Company "A" whose tax period coincides with the calendar year and whose net turnover amount did not exceed 20 million euros In the years 2023 and 2024, it has made a series of donations to different foundations to which the special regime provided for in Law 49/2002 applies.
The data of company "A" to be taken into account in its Corporate Tax settlement are the following:
Exercise 2023
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Taxable base: 2,000,000
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Full fee (25%): 500,000
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Donation: 300,000
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Base Limit Deduction for donations = 10% 2,000,000 (BI) = 200,000
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> 10% BI (Deduction base = 200,000) = 300,000 – 200,000 = 100,000 euros.
This amount may be applied to tax periods ending in the next 10 years.
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</= 10% BI (Deduction base = 200,000) = 200,000 euros
Deduction in the fee that I can apply for not exceeding the limit of the deduction base = 200,000 x 35% = 70,000 euros.
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Settlement of Corporate Tax 2023 (with sufficient net tax)
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Taxable base: 2,000,000
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Full fee (25%): 500,000
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(-) Deduction donations 2023: 70,000
- Result: 430,000
Settlement of Corporate Tax 2023 (without sufficient net tax)
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Taxable base: 2,000,000
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Full fee (25%): 500,000
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(-) Deduction for double taxation: 450,000
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(-) Deduction donations 2023: 50,000
The entity can only apply 50,000 euros of the 70,000 euro donation deduction generated. There are 20,000 pending that have already been calculated with the rate (35%) and limit (10%) of 2023. Therefore, these 20,000 euros are a deduction generated in the tax period not deducted due to insufficient net tax, which may be applied without limit in the settlements of tax periods ending in the next 10 years.
- Result: 0
Deduction for donations 2023 pending application in future years:
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100,000 euros of deduction base that has exceeded the 10% limit on the Tax Base to which the new deduction rates in force after the modification made by Royal Decree-Law 6/2023 (40%/50%) and the new limit on the tax base of the period (15%) will be applied.
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20,000 euros deduction in contributions that can be applied without limit.
Exercise 2024
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Taxable base: 2,000,000
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Full fee (25%): 500,000
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Donation: 500,000
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Base Limit Deduction for donations: 15% 2,000,000 (BI) = 300,000
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> 15% BI (Deduction base = 300,000): (500,000 - 300,000) = 200,000 euros.
This amount may be applied to tax periods ending in the next 10 years.
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</= 15% BI (Deduction base = 300,000): 300,000 euros
Deduction in quota that I can apply for not exceeding the limit of the deduction base: (300,000 x 40%) = 120,000 euros.
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Corporate Tax Settlement 2024
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Taxable base: 2,000,000
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Full fee (25%): 500,000
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(-) Deduction donations 2023: 20,000 (applied without limit)
Regarding the deductions for donations that remain to be applied, the company "TO" You can choose between:
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(-) Deduction Donations pending 2023: (100,000 euros x 40%) = 40,000, and
(-) Donation Deduction generated in 2024: (200,000 x 40%) = 80,000 euros
Deductions for donations pending application in future years:
There are €100,000 of deduction base pending for 2024 that have not exceeded the limit of 15% of the tax base, but have not been applied because the pending donation deduction for 2023 has been applied, as well as €200,000 of deduction base for 2024 that could not be applied because they exceeded the limit of 15% of the tax base; Both amounts may be applied in the tax periods ending in the next 10 years.
Total: (40,000 + 80,000) = 120,000
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(-) Donation Deduction 2024: 120,000 euros
Deductions for donations pending application in future years:
There are still €100,000 of deduction base generated in 2023 that exceeded the 10% limit of the tax base and €200,000 of deduction base from 2024 that could not be applied because they exceeded the 15% limit of the tax base; Both amounts may be applied in the tax periods ending in the next 10 years.
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Result: 360,000