Non deductible expenses

Non-deductible expenses include:

• Fines and penal and administrative sanctions, urgency charges and surcharges for late filing of returns/assessment and self-assessments.

• Donations and generosity

  Donations and gratuities are not considered expenses for public relations with clients or suppliers, nor those made in accordance with customs and practices with respect to the company's personnel, nor those made to promote, directly or indirectly, the sale of goods and provision of services, nor those that are correlated with income. However, these expenses are subject to the limit of percent of the net amount of turnover for tax period.

• Allocations to provisions or internal funds for the coverage of contingencies identical or similar to those that are the subject of the Pension Plans

• Contributions to Social Security Mutual Societies of the entrepreneur or professional himself, without prejudice to the fact that they may be subject to reduction of the general part of the taxable base .

  However, amounts paid under insurance contracts entered into with mutual benefit societies by professionals not included in the special Social Security scheme for self-employed workers or freelancers will be considered as deductible expenses when, for the purposes of complying with the obligation provided for in section 3 of the fifth transitional provision and in the fifteenth Additional Provision of Law 30/1995, of November 8, on the Regulation and Supervision of Private Insurance, they act as alternatives to the aforementioned special Social Security scheme, in the part aimed at covering contingencies attended to by Social Security, with a limit of 4,500 euros per year (art. 30.1 of the Law).

• Service expenses corresponding to operations carried out, directly or indirectly, with persons or entities resident in countries or territories that are regulated as tax havens, or that are paid through persons or entities resident in the same, unless it is proven that the expense corresponds to an operation or transaction actually carried out.

• The amounts that due to the application of floor clauses have been paid by the taxpayer in 2016 and for which, before the end of the deadline for filing the declaration, an agreement is reached with the financial institution to return them or in compliance with court rulings or arbitration awards, will not be considered deductible expenses.

• Personnel expenses corresponding to compensation arising from the termination of the employment relationship, common or special, or the commercial relationship, of administrators or members of the Boards of Directors, of the Boards that act in their place and other members of other representative bodies, occurring since January 1, 2013, when they exceed, for each recipient, the highest of the following amounts.

  1. 1,000,000 euros.

  2. The amount established as mandatory in the Workers' Statute for dismissal or termination.