Corporate Income Tax News 2023

For this fiscal year 2023, the main changes in the Corporate Income Tax (IS) are focused on adopting measures for emerging companies, micro-enterprises and for those that undertake investments in energy saving. Below, we are going to see the main novelties for the liquidation of this fiscal year.

Regulatory novelties with incidence on the tax return forms

1. Freedom of amortization of installations using energy from renewable sources.

Firstly, the possibility of freely amortizing investments made in installations for self-consumption of electricity is introduced. This change can be applied in tax periods beginning or ending in 2023. This modification also includes investments in installations for thermal use for own consumption, provided that they use energy from renewable sources and replace installations that use energy from non-renewable fossil fuel sources.

The amount of the investment that may benefit from the free depreciation regime will be 500,000 euros. For the application of this case it is necessary that, during the 24 months following the date of commencement of the tax period, the total average workforce of the entity is maintained with respect to the average workforce of the previous twelve months. In addition, taxpayers must have the necessary documentation to prove this investment.

2. Accelerated depreciation of certain vehicles

For tax periods starting from 2023 onwards, an accelerated depreciation scenario is introduced for investments in certain new vehicles. These vehicles must be used for economic activities and must enter into operation in the tax periods beginning in 2023, 2024 and 2025. The amendment allows them to be depreciated based on the result of multiplying by 2 the maximum straight-line depreciation coefficient provided for in the officially approved depreciation tables.

With effect from June 30, 2023, this accelerated depreciation scenario is extended to investments in new electric vehicle recharging infrastructures, of normal or high power.

3. Reduced tax rate

Also from 2023, a new reduced tax rate of 23 percent is introduced. Entities whose net turnover for the immediately preceding tax period is less than 1 million euros are eligible for this reduction. In order to know how to calculate the net amount of the turnover we have to go to paragraphs 2 and 3 of article 101 of the LIS.

4. Deduction for investments in film productions

In order to encourage investment in culture, it has been decided to increase the limits of the deduction for investments in films and series, whether Spanish or foreign. The maximum amount of the deduction is increased to 20 million euros for films. In the case of series, the deduction is determined per episode, with a limit of 10 million euros for each episode produced.

5. Income not subject to withholding tax

Another of the most important novelties is that a series of withholding obligations are eliminated. From this fiscal year, there will be no obligation to withhold or pay on account with respect to income derived from the following events:

– The reimbursement or transfer of participations or shares issued by listed funds or by listed open-end investment companies regulated by article 79 of the Regulations for the development of Law 35/2003 or collective investment institutions incorporated abroad analogous to those mentioned above.

– The interest received by the securities companies as a consequence of credits or loans granted in relation to purchase or sale operations of securities referred to in article 126.b) of Law 6/2023, of March 17, of the Securities Markets and Investment Services.

– Interest received by investment services companies in respect of active loan or deposit transactions referred to in article 70.1 of Royal Decree 813/2023, of November 8, on the legal regime of investment services companies and other entities providing investment services.

– Interest received by central counterparties or by entities that are members of a central counterparty.

– The consideration for the guarantees constituted in application of the provisions of Article 97.2 of the Securities Markets and Investment Services Law of Articles 41 and 42 of Regulation (EU) number 648/2012 of the European Parliament and of the Council of 4 July 2012.

– The interest received by the managing entities of the payment systems recognized in accordance with Law 41/1999, of November 12, on payment and securities settlement systems, as well as by the entities that have the status of participants in these systems, from guarantees constituted in application of the provisions of letter d) of article 2 of said law, or from the accounts exclusively affected to the performance of the operations inherent to the corresponding payment system.

6. Emerging companies («Startup»)

A series of tax incentives will be applied for the taxpayers of Corporate Income Tax and Non-Resident Income Tax who obtain income through a permanent establishment located in Spanish territory and who have the status of an emerging company as provided therein:

– They will be taxed at the rate of 15% in the first tax period in which, having the status of emerging company, the taxable income is positive and in the following three periods, provided that they maintain such status.

– They will be able to request to the State Tax Administration, at the moment of the presentation of the self-assessment, the postponement of the payment of the tax debt corresponding to the first two tax periods in which the taxable base of the Tax is positive.

– They will not have the obligation to make the installment payments regulated in articles 40 of the LIS and 23.1 of the TRLIRNR that they must make on account of the liquidation corresponding to the tax period immediately following each one of the tax periods in which the deferral referred to in the previous point has been requested, as long as in them the condition of emerging company is maintained.

7. Temporary levies: energy and credit institutions/financial establishments.

Finally, we are going to talk about the temporary energy tax and the tax on credit institutions and financial credit establishments. Both will have this temporary character during the years 2023 and 2024.

The temporary energy tax must be paid by the persons or entities that have the consideration of main operator in the energy sectors, according to the Resolution of December 10, 2020 of the National Commission of Markets and Competition.

The temporary levy of credit institutions and financial credit institutions must be paid by institutions operating in Spanish territory and whose income from interest and commissions corresponding to the fiscal year 2019 is equal to or higher than 800 million euros.

Both levies are configured as a non-tax public property benefit, which are not considered as tax-deductible expenses for the purpose of determining the taxable base of the Corporate Income Tax.

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