7.5.2.2. Gross income

This section will include all income, including self-consumption, subsidies and other transfers.

OPERATING INCOME

Operating income is the amount of compensation obtained from the sale of goods and the provision of services that constitute the object of the activity, including those from services ancillary to the main activity.

OTHER INCOME (including grants and other transfers)

The following concepts, among others, will be included in this section:

1. Work carried out for the company itself

   Without prejudice to its computation as an expense according to its nature, at the end of the financial year the cost of production of the fixed assets manufactured or constructed by the company itself will be considered as counterpart income.

2. Surpluses and applications of provisions

   Excesses and applications of provisions that have constituted a tax-deductible expense will be recorded as income.

3. Other management revenue

   For example, compensation for mediation services performed accidentally, or for the occasional provision of certain services (transport, repairs, advice, reports, etc.), or income for services to staff.

4. Compensation received from insurance companies

   Compensation received from insurance companies for incidents affecting operating products (stocks of merchandise, raw materials, containers, packaging, etc.).

5. Grants and public aid

   Subsidies and other public aid received in the course of the activity shall be indicated, not including those that are exempt and in accordance with the following imputation criteria:

   • Capital subsidies:

     These are granted to promote the establishment of an activity or the realization of investments in fixed assets.

     They are recorded as income in proportion to the depreciation experienced in the year (amortization) by the assets financed with said subsidies.

     In the case of non-depreciable assets, the subsidy will be charged to the results of the year in which the sale or write-off of the assets in the inventory occurs, with a reduction of 30% applied to box 0132 they are considered by regulation to be income obtained in a notoriously irregular manner over time.

   • Farm subsidies:

     These are generally granted to ensure a minimum profitability or compensate for losses incurred in the activity.

     They are fully attributed as income in the period in which they accrue.

SELF-CONSUMPTION OF GOODS AND SERVICES (art. 28.4 Law)

The normal market value of the goods and services that are the object of the activity and that the taxpayer gives or lends to third parties free of charge or are intended for personal use or consumption will be included as income.

Likewise, when there is consideration and this is significantly lower than the normal market value of the goods and services, the latter will be taken into account.

TRANSFER OF ASSETS THAT HAVE ENJOYED FREEDOM OF AMORTIZATION: EXCESS DEDUCTED AMORTIZATION REGARDING DEDUCTIBLE AMORTIZATION. (Additional Provision Thirtieth of the Personal Income Tax Law)

If assets have been transferred that would have enjoyed the freedom of amortization provided for in the eleventh Additional Provision or in the thirty-seventh transitional provision, both of the consolidated text of the Corporate Income Tax Law, in order to calculate the capital gain or loss that, where appropriate, may arise from the transfer, the transfer value will not be reduced by the amount of the tax-deductible amortizations that exceed those that would have been tax-deductible had the former not been applied.

The aforementioned excess will be considered the total income from the economic activity, and must be recorded in box 093 of Section E1 in the tax period in which the transfer is made.

VAT treatment

Income should not include the amount of VAT charged, unless the activity carried out is in the Special Regime of the Equivalence Surcharge or in that of Agriculture, Livestock and Fishing.