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Issues to consider when settling the tax in 2023

We inform you of the main developments for the 2023 Corporate Tax Campaign.

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Freedom to amortize facilities that use energy from renewable sources

Royal Decree-Law 18/2022, of October 18, introduces with the Seventeenth Additional Provision of the LIS a new case of freedom of amortization by which taxpayers may freely amortize, in the tax periods that begin or end in 2023, the investments made in facilities :

  • Intended for self-consumption of electrical energy that uses energy from renewable sources in accordance with the provisions of Royal Decree 244/2019, of April 5.

  • For thermal use for own consumption that uses energy from renewable sources , that replaces installations that use energy from non-renewable fossil sources and that are made available to the taxpayer from the entry into force of Royal Decree-Law 18/2022 (October 20) and come into operation in 2023.

The aim of this measure is to promote the displacement of fossil fuels by renewable energies produced locally in order to contribute to improving the competitiveness of Spanish companies, the fight against climate change and improving the country's energy security.

Subsequently, Royal Decree-Law 8/2023, of December 27, has modified the Seventeenth Additional Provision of the LIS to extend this assumption of freedom of amortization for one more year , so that the aforementioned investments may also be freely amortized in the tax periods that begin or end in 2024, when they come into operation in 2024.

Therefore, the investments mentioned must be made available to the taxpayer as of November 20, 2022 and come into operation in 2023 and 2024.

The amount of the investment that may benefit from the free amortization regime will be 500,000 euros.

For the application of this assumption of freedom of amortization, it is necessary that during the 24 months following the start date of the tax period in which the acquired elements come into operation the total average workforce of the entity is maintained with respect to the average workforce of the previous twelve months .

To calculate the total average workforce of the entity, the number of employees will be taken into account, in accordance with the terms established by labour legislation, taking into account the contracted working hours in relation to the full working day.

Keep in mind:

The ERTEs derived from the situations provided for in Royal Decree-Law 8/2020 determine, for the purposes of calculating the average workforce provided for in article 38 of the LIS, that the part of the employment contract that is temporarily suspended is not computed.

In addition, taxpayers must be in possession of the following documentation that proves that the investment uses energy from renewable sources:

  • In the case of generation of electrical energy , the Operating Authorization and, in the case of facilities with surpluses, the accreditation of registration in the Administrative Registry of Electrical Energy Production Facilities (RAIPREE) or, in the case of facilities of less than 100kW, the Electrical Installation Certificate (CIE) in accordance with the Low Voltage Electrotechnical Regulations, in accordance with the provisions of Royal Decree 244/2019, of April 5.

  • In the case of renewable gas production systems (biogas, biomethane, renewable hydrogen), proof of registration in the Registry of gas production facilities from renewable sources regulated in article 19 of Royal Decree 376/2022, of May 17.

  • In the case of thermal renewable energy generation systems (heat and cold) industrial or process , proof of registration or report from the competent body in the Autonomous Community.

  • In the case of thermal renewable energy generation systems (heat and cold) for air conditioning or generation of domestic hot water , energy efficiency certificate issued by the competent technician after the investments have been made, indicating the incorporation of these systems with respect to the certificate issued before the start of the same.

Buildings and installations that are mandatory under the regulations of the Technical Building Code , approved by Royal Decree 314/2006, of March 17, will not be eligible for this incentive, unless the installation has a nominal power greater than the minimum required.

This assumption of freedom of amortization is incompatible with the assumption of freedom of amortization of article 102 of the LIS provided for small entities, so said entities must choose to apply one of the two tax incentives.

Keep in mind:

Self-consumption of electrical energy shall be understood as the consumption by one or more consumers of electrical energy from production facilities close to and associated with consumption facilities. Self-consumption modalities are established:

  1. Supply mode with self-consumption without surplus. In this modality, an anti-dumping mechanism must be installed to prevent the injection of excess energy into the transmission or distribution network.

  2. Supply mode with self-consumption with surpluses. In this modality, production facilities close to and associated with consumption facilities will be able, in addition to supplying energy for self-consumption, to inject surplus energy into the transport and distribution networks.

Keep in mind:

Renewable energy is considered:

  • That coming from non-fossil renewable sources , that is, wind energy, solar energy (solar thermal and solar photovoltaic) and geothermal energy, ambient energy, tidal energy, wave energy and other types of energy ocean energy, hydropower and energy from biomass, landfill gases, wastewater treatment plant gases, and biogas, as defined in Directive (EU) 2018/2001.

  • In the case of electricity production facilities , only that energy coming from facilities in category b) of article 2.1 of Royal Decree 413/2014, of June 6, will be considered renewable energy.

  • In the case of installations that use electrically driven heat pumps only their use for heat will be considered renewable energy based on a seasonal factor performance (SCOPnet) of 2.5 in accordance with the Commission Decision 2013/114/EU of March 1, 2013.

    In the event that such pumps are used for cold , they will only be considered to produce renewable energy when the refrigeration system operates above the minimum efficiency requirement expressed as a primary seasonal performance factor and this is at least 1.4 (SPFplow), in accordance with the provisions of Commission Delegated Regulation (EU) 2022/759 of December 14, 2021 amending Annex VII of Directive (EU) 2018 /2001.

  • In the case of thermal renewable energy generation systems (heat and cold) for air conditioning or domestic hot water generation, it will only be understood that non-renewable primary energy consumption has been improved when the non-renewable primary energy consumption indicator is reduced by at least 30 percent, or an improvement in the energy rating of the facilities is achieved to obtain an energy class "A" or "B", on the same rating scale.