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Practical manual for Income Tax 2024. Part 1

Deductions for incentives and stimuli to business investment in economic activities in direct estimation

Regulations: Articles 68.2 and 69.2 Law IRPF

Taxpayers who carry out economic activities in direct estimation may apply the incentives and stimuli for business investment established or to be established in the Corporate Tax regulations with equal percentages and deduction limits, with two exceptions :

  1. The provisions of article 39.2 of the LIS which establishes the possibility of applying the deduction for research and development and technological innovation activities in sections 1 and 2 of article 35 of the ## LIS , are not applicable to taxpayers of IRPF , applying the same with a discount of 20% of its amount, without being subject to the joint limit of the full quota and being able to request, where appropriate, its payment, provided that certain requirements are met.

    Regarding the LIS see Law 27/2014, of November 27, on Corporate Tax.

  2. The provisions of article 39.3 of the LIS which allows, in relation to the deduction for foreign cinematographic productions in Spain provided for in section 2 of article 36 of the 3## LIS 3## , to request, in the event of insufficient quota, the advance payment of the deduction for investment in foreign production of cinematographic feature films or audiovisual works, are also not applicable to taxpayers of the IRPF .

In addition to the deductions established by the LIS , with the exceptions indicated above, taxpayers of the IRPF whose activities meet the requirements to be considered small entities may deduct the net income from economic activities of the tax period that are invested in new elements of tangible fixed assets or real estate investments related to economic activities in the terms discussed below.

Consequently, in the current fiscal year 2024, the deductions for incentives and stimuli for business investment that taxpayers with economic activities can apply under the direct estimation method, in either of its two modalities, normal or simplified, can be structured into the following categories or regimes:

  1. General regime and special regimes of deductions for incentives and stimuli to business investment of the Corporate Income Tax Law
  2. Deduction for investment in new elements of tangible assets or real estate investments used for economic activities
  3. Special regime for business investments in the Canary Islands
  4. Special tax regime of the Balearic Islands