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Form 100. Personal Income Tax Declaration 2018

7.5.1.5. Small businesses

A company is considered to be small when the net amount of the previous year's turnover was less than 10 million euros.

If the activity had started in the previous year, the net amount of the turnover will increase per year.

If the activity began in 2018, the amount of the turnover for the year 2018 itself will be taken into account.

To determine the net amount of the turnover, all the economic activities carried out by the taxpayer will be taken into account.

When a natural person alone or jointly with the spouse or other natural persons united by ties of kinship in a direct or collateral line, consanguineous or by affinity, up to the second degree inclusive, are in relation to other entities of which they are partners In some of the cases referred to in article 42 of the Commercial Code, the net amount of the turnover will refer to the group of people and entities belonging to the group.

NOTE:

As of January 1, 2011, the tax incentives established for small companies will also be applicable in the three tax periods immediately and following that tax period in which the company reaches the aforementioned turnover of 10 million euros. , provided that it has met the conditions to be considered small both in that period and in the two tax periods prior to the latter.

Likewise, the provisions of the previous paragraph will be applicable when said turnover is reached as a result of carrying out an operation regulated in Chapter VIII of Title VII of the Corporate Tax Law, provided that the company that has carried out such operation meets the conditions to be considered as small in size both in the tax period in which the operation is carried out and in the two tax periods prior to the latter.

FISCAL BENEFITS

Small companies can benefit from a special depreciation regime for certain elements:

  1. Freedom to depreciate

    1. For employment-generating investments , in the form and conditions established in article 102 of the Corporate Tax Law.

    2. For low value investments : The freedom of amortization for investments of low value that the previous consolidated text of the Corporate Tax Law regulated in its article 110 only for small entities has been replaced in the new LIS by a similar benefit applicable to all taxpayers of the aforementioned tax and is applied to new tangible fixed assets, whose unit value does not exceed 300 euros, up to the limit of 25,000 euros referring to the tax period. If the tax period were less than one year long, the stated limit would be the result of multiplying 25,000 euros by the corresponding proportion between the duration of the tax period with respect to the whole year. (article 12.3 LIS)

  2. Accelerated depreciation

    1. The new elements of tangible fixed assets and real estate investments, as well as the elements of intangible fixed assets , which have been made available to the taxpayer in a tax period in which the activity is considered small company, may be amortized by multiplying by 2 the maximum linear amortization coefficient provided for in the officially approved amortization tables.

    2. The elements of intangible assets with an indefinite useful life and goodwill that cannot be amortized but in which losses due to impairment of their value are deductible, a 5 percent of its acquisition value, provided that the company is considered Small Dimension.

    3. Transitory rules: The holders of economic activities who, prior to January 1, 2015, applied the amortization of the elements of tangible fixed assets and real estate investments assigned to economic exploitations in the that materialized the reinvestment of the total amount obtained in the onerous transfer of elements of tangible fixed assets and real estate investments, also assigned to economic exploitations, which were amortized based on the coefficient that resulted from multiplying by 3 the maximum linear amortization coefficient provided for in the amortization tables, may continue with its application.

  3. Financial leasing

    In relation to the assets acquired under the special financial leasing regime, the part of the installments that corresponds to the recovery of the cost of the depreciable assets is considered a deductible expense, with a limit of three times the linear amortization coefficient according to officially amortization tables. approved. The excess will be deductible in successive tax periods, respecting the same limit.

  4. Losses due to impairment of credits due to possible insolvencies of debtors (art. 104 Corporate Tax Law)

    In addition, taxpayers who determine the performance of their activity in the direct estimation regime may deduct the loss due to deterioration of credits to cover the risk derived from possible insolvencies up to the limit of 1 percent of the existing debtors at the conclusion. of the tax period, under the conditions established in article 112 of the Corporate Tax Law.