News published in INFORMA 2017

New features introduced in the INFORMA programme during MARCH

The limit established in article 15.i) of the Spanish Corporation Tax Act will be applicable in relation to a worker's severance pay. Nevertheless, this limit is not applied when the worker receives pay for an incentives plan. In this case, the remuneration does not fit into the framework of severance pay, and the limit established in article 15.i) of the Spanish Corporation Tax Act is not applicable.

In writing off debts between a lender and a borrower, when the operation is the result of a link between both parties, and when the same tax value of the credit and debit rights exists for both parties, in a tax context it must be understood that the market value at which said write-off takes place corresponds with the contractual obligation of the loan contract between the related parties, without having to take into account the potential impairment that may exist in the credit right.

In accordance with the Chart of Accounts, in part five, buses for transporting passengers by road are considered external transport elements. Internal transport elements are those considered to be used for transporting staff, animals, materials and goods within factories, workshops, etc., without going outside. These considerations are for the purposes of applying the amortisation table contained in article 12 of the Spanish Corporation Tax Act.

Expenses derived from paying the works council is a tax deductible expense for the purposes of the Spanish Corporation Tax Act, provided that the legally established conditions are met, under the terms of registering accounts, taxation in accordance with accrual and justification, insofar that said expenses are not understood to be included in the category of donations described in article 15 of the Spanish Corporation Tax Act.

Payments derived from the obligations of the sole shareholder with his/her spouse are not considered to be part of the entity's dividend distribution. On the other hand, in accordance with article 15 of the Spanish Corporation Tax Act, donations will not be considered tax deductible expenses, and are therefore considered non-deductible expenses.

Article 13.2 of the Spanish Corporation Tax Act establishes that losses for the deterioration of tangible fixed assets will not be tax deducible. Breeding birds have this consideration, and are deductible under the terms established in article 20 of the Spanish Corporation Tax Act.

When transmitting a subordinated loan with losses to a third party, no adjustments for tax purposes can be made in relation to accounting entries. Nevertheless, if the loan has become impaired prior to the transmission, and said impairment was not tax deductible, the difference between both values will be incorporated into the gross tax base of the transferring entity at the time of the transmission.

Expenditure derived from delivering small-value gifts, with the intention of promoting sales, constitutes a promotional expense. For this reason, it is not included in the category of expenses for customer services, and is thus not subject to the 1% limit of the net amount of the turnover during the tax period.

Agrarian Transformation Companies (ATC) are civil companies and therefore have legal personality and the full capacity to act in order to comply with their purposes from the time of registering in the corresponding registry. If they request disqualification from the registry but continue to develop an activity with a commercial form, they will continue to pay Corporation Tax until the end of the tax period.

When an Agrarian Transformation Company becomes a limited company (which is a civil company with legal personality and with its own economic and social objective), insofar as the legal personality is not altered, nor does it change the entity's applicable tax regime as part of Corporation Tax, the acquisition of income will not be determined for tax purposes with respect to the company, nor will it represent the end of the tax period.

Insofar that the SICAV Mutual Fund, resulting from the transformation of a limited company, does not meet the requirements for applying a tax rate other than the general one, this does not entail the conclusion of the tax period, nor does it generate any type of income for the entity.