For participation in the equity of agricultural entities

Regulations: Art. 13 ter.Cinco Consolidated text of the legal provisions of the Autonomous Community of Galicia on taxes transferred by the State, approved by Legislative Decree 1/2011, of July 28.

• Requirements for applying the deduction
  • That among the assets or rights of economic content computed for the determination of the tax base are included shares in the equity of entities whose corporate purpose is agricultural activities.
  • The acquired shares must remain in the taxpayer's assets for a minimum period of five years following their acquisition .
  • The agricultural holding must be registered in the Registry of Agricultural Holdings of Galicia. The terms "agricultural holding" and "agricultural activity" shall be those defined in Law 19/1995, of July 4, on the modernization of agricultural holdings.
  • The same deduction will apply to loans granted to the same entities in the part of the amount that finances said agricultural activities.

    In the case of loans, these must refer to financing operations with a term of more than five years, without being able to amortize an amount greater than 20% per year of the principal amount lent.

• Amount of deduction
  • 100 percent of the portion of the share that proportionally corresponds to the value of the shares.
  • The value of the shares will be determined , according to the rules of the Wealth Tax, in the part that corresponds to the proportion existing between the assets necessary for the exercise of the agricultural activity, reduced by the amount of the debts derived from this, and the value of the net assets of the entity.

    To determine this proportion, the value deduced from the accounting will be taken, provided that it faithfully reflects the true financial situation of the company.

• Incompatibility

  This deduction will be incompatible with the application to the same assets or rights of the exemptions of article 4 of the Wealth Tax Law, even if said exemption is partial.