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News in fractional payments 2P Companies 2019

The main new features included in the installment payment for October 2019 ( 2P ) on account of Corporate Tax and Income Tax for non-Residents with Permanent Establishment are the following:

  1. Branches zone ZEC in fiscal consolidation

    In accordance with the provisions of the fourteenth bis Additional Provision of Law 19/1994, of July 6, modifying the Economic and Fiscal Regime of the Canary Islands, introduced by Law 8/2018, of November 5, taxpayers who have Branches of the Canary Islands Special Zone of entities with tax residence in Spain that are part of a tax group that applies the tax consolidation regime, must separately declare the part of the tax base attributable to the branch of the Canary Islands Special Zone.

    This obligation must also extend to the obligation to make installment payments in accordance with the modality provided for in section 3 of article 40 of Law 27/2014, of November 27, on Corporate Tax (hereinafter LIS ).

    Therefore, starting from the 2P 2019 period, each of these entities must present the payment on account of this tax in their corresponding form 202. In this settlement, the amounts of previous installment payments corresponding to the computable period that, if applicable, could have been included in the tax consolidation regime model 222, period 1P , may be deducted.

    All of this, without prejudice to Form 222 that the dominant entity must present for the part of the tax base that is not taxed at the special rate and for which the special tax consolidation regime will apply.

  2. Shipping entities under special regime depending on tonnage

    In accordance with the modification in the fourth Additional Provision of the LIS, introduced by article four of Law 8/2018, of November 5, which modifies Law 19/1994, of July 6, modifying the Economic and Fiscal Regime of the Canary Islands, entities that pay taxes under the special tonnage regime are excluded from the minimum installment payment.

    The fractional payments of these entities will be made as follows:

    • Entities whose tax base is determined in its entirety according to the objective estimation method .

      In the “additional data (3)” section of form 202, they will mark the key “entity that applies the shipping entities regime based on tonnage” and enter 25% in the key “current corporate tax tax rate”.

      For these taxpayers, in the case of companies with a turnover equal to or greater than 10 million euros, the minimum amount of the installment payment will not be applicable, so the form for completing model 202 will not calculate box 33 (minimum to enter).

    • Entities whose tax base is determined partly according to the objective estimation method and partly by applying the general tax regime (activities not included in the special regime).

      In the “additional data (3)” section of form 202, they will mark the key “entity that applies the shipping entities regime based on tonnage”, the key “other entities with the possibility of applying two tax rates” and enter 25/25N in the key “current corporate tax rate”.

      In those cases in which the presentation of the installment payment is made by direct presentation (without using the form) due to space restrictions in the definition of the field " Additional data - Type of taxation of the Corporate Tax for the year in progress " the value "25/25" should be set instead of the value "25/25N".

      Completion of section “B.2 Specific cases (entities with more than one percentage):

      • Box 20 (type 1 base) will include the base of the fractional payment that corresponds to the activities of the entity that are taxed under the general regime. The form of model 202 will calculate in key 21 the percentage applicable for the purposes of the installment payment in relation to the activities included in the general regime and in key 22 the resulting amount.
      • Box 23 (type 2 base) will include the base of the fractional payment that corresponds to the activities of the entity that are taxed under the special regime. The form of model 202 will record 25% in key 24 and the resulting amount in key 25.

      In the case of companies with a turnover equal to or greater than 10 million euros, the declarant must include in box 33 (minimum to enter) the amount that, if applicable, corresponds to the activities included in the general regime, since that these activities are not excluded from the minimum installment payment. This information must be entered directly by the declarant.

      In accordance with the fourteenth Additional Provision of Law 27/2014, of November 27, on Corporate Tax, in the wording given by Royal Decree Law 2/2016, of September 30, which introduces targeted tax measures to the reduction of the public deficit, the amount to be paid may not be less, in any case, than 23% (25% for taxpayers to whom the type of tax provided for in the first paragraph of section 6 of article 29 of this Law) of the positive result of the profit and loss account for the year of the first 3, 9 or 11 months of each calendar year or, for taxpayers whose tax period does not coincide with the calendar year, of the year elapsed from the beginning of the period tax until the day before the beginning of each payment period of the installment payment, determined in accordance with the Commercial Code and other accounting regulations of development, reduced exclusively by the installment payments made previously, corresponding to the same tax period.