7.5.1.3. Temporary attribution

GENERAL RULE (art. 14.1.b) Law)

Taxpayers who carry out economic activities will apply to the income derived from said activities, exclusively, the criteria of temporary imputation provided for in the Corporate Tax Law and its implementing regulations.

As a general rule, income will be allocated in the tax period in which it accrues, regardless of the time of collection, and will be deemed to have accrued when the goods are made available or the services are provided.

Likewise, as a general rule, expenses are accrued when the goods are made available or the service is provided, depending on the nature of the expense, regardless of the time of payment.

Pending court ruling: When all or part of an income has not been paid because the determination of the right to receive it or its amount is pending a judicial resolution, the unpaid amounts will be charged to the tax period in which it becomes final.

Returns from forward transactions: Income will be deemed to be obtained proportionally as the corresponding payments become due, unless the taxpayer decides to impute them at the time the right arises.

CRITERIA FOR TEMPORAL ALLOCATION OF COLLECTIONS AND PAYMENTS (art. 7.2 Rgl.)

Taxpayers who carry out economic activities and are not fiscally required to keep their accounting records in accordance with the provisions of the Commercial Code, and who fulfil their accounting and registration obligations by keeping the tax record books provided for in each case, may opt for the collection and payment criterion to temporarily allocate the income and expenses of all their economic activities.

This criterion will be deemed approved by the tax authorities simply by stating it in the corresponding declaration, and must be maintained for a minimum period of three years.

The option for the criterion indicated in this section will lose its effectiveness if, after said option, the taxpayer is obliged for tax purposes to keep his accounting adjusted to the provisions of the Commercial Code or chooses to keep his accounting in this way.

In no case will changes in the criteria for temporary allocation or the system for determining net income result in any expense or income not being computed or being allocated again in another fiscal year.