Today, July 1, the Tax Agency launches the Corporate Tax Campaign for the year 2020, this year the deadlines are again the general deadlines that were modified the previous year due to the health crisis, therefore, a single deadline for submission: twenty-five days after the passage of six months from the end of the tax period, for the years that coincide with the calendar year, the term ends the July 25.
Main novelties in the SI declaration models for the 2020 financial year
In the BOE of June 8, 2021, and in force as of today, July 1, the HAC/560/2021 has been published, which approves the declaration models of Corporation Tax and Income Tax of Non-Residents corresponding to permanent establishments and entities under the income attribution regime constituted abroad with a presence in Spanish territory, for tax periods starting between January 1 and December 31, 2020, issues instructions regarding the declaration and income procedure and establishes the general conditions and the procedure for its electronic filing.
Below are some other new features introduced in the 200 model:
- The AEAT started last year the service of consultation of tax data on companies, which it maintains for the year 2020, these data are informative.
- The table detailing the corrections to the profit and loss account result is mandatory for all adjustments, with the detail of permanent or temporary, originating in the previous year or years
- Changes related to the economic and fiscal regime of the Canary Islands in relation to deductions for investments in the Canary Islands with increased limits.
- With respect to the financial statements, the Profit and Loss Account details the expenses for the services of independent professionals independently of the rest of the operating expenses.
As in previous years, the forms provided for providing information in relation to certain corrections and deductions to the profit and loss account of EUR 50,000 or more are published without variation (Annex III) and the annual report of activities and projects carried out and researchers affected by Social Security bonuses (Annex IV).
A new annex, Annex V, appears for the communication of the materialization of anticipated investments and their financing system with respect to the Reserve for investments in the Canary Islands.
In 2020, Royal Decree-Law 35/2020 of 22 December is published, article 14 of which includes a modification in the deductibility of impairment losses of claims arising from possible insolvencies of debtors in small companies in the tax periods beginning in 2020 and 2021.
Taxpayers of Corporation Tax, Personal Income Tax or Non-Resident Income Tax who obtain income through a permanent establishment located in Spanish territory who meet the conditions of article 101 of Law 27/2014, of November 27, on Corporation Tax, in the tax periods that begin in 2020 and in 2021 may deduct, in these periods, the impairment losses of the credits derived from the possible insolvencies of debtors when at the time of the accrual of the tax the period that has elapsed since the expiration of the obligation referred to in letter a) of section 1 of article 13 of said law is three months, instead of six months which was the previous term.
The filing deadline
It is generally maintained within 25 calendar days of six months after the end of the tax period (this year to be Sunday on July 25, the deadline ends on July 26),for entities whose 2020 tax period coincides with the calendar year.
However, if the tax period coincides with the calendar year, and the direct debit of the payment of the tax debt, the deadline for such direct debit ands from 1 to 20 July 2021, inclusive, although it may be done in the deposit entity acting as a contributor to the collection management (bank, savings bank or credit union) located in Spanish territory where the account in which the payment is domiciled is open in her name. In cases of direct debit, payments are understood to be made on the date of debit on the account of direct debits, with proof of income being deemed to be that issued by the deposit institution.
All this, without prejudice to the deadlines for the submission of declarations established by the Autonomous Communities of the Basque Country and Navarra.
Remember that it will be mandatory for taxpayers to file the Models 200 and 220via the Internet, regardless of the form or name adopted by the taxable person.
Impact of COVID-19 on annual accounts and corporation tax
The Order that approves the new models for the presentation in the Mercantile Registry of the annual accounts, this year includes several novelties:
- The inclusion, in the instance of presentation of the models of deposit of accounts, of the date of issuance of the audit report, indication of the type of audit -voluntary or mandatory- carried out and the number of ROAC of the auditor or audit firm that has issued the report, contemplating in turn the possibility of intervention of more than one auditor or auditing entity.
- The separate presentation of non-financial information, which is part of the management report of the companies obliged to make it in accordance with Law 11/2018
- Exceptionally and transiently, the COVID 19 declaration sheet is included, with specific reference to the impact of the state of alarm due to the COVID pandemic on companies.
- As an important change of a commercial nature, which affects the distribution of results, companies that have taken advantage of employment regulation files regulated in RDL 18/2020, may not proceed to the distribution of dividends corresponding to the fiscal year in which these files are applied, this limitation will not apply to companies that had less than five workers in a situation of registration. This limit means that the right of separation of members provided for in Article 348a(1) of the Capital Companies Law does not apply.
Who is subject to Corporation Tax?
The tax is determined by the residence in Spanish territory. Entities in which one of the following requirements is met shall be considered resident in Spanish territory:
- That they would have been constituted in accordance with Spanish law.
- Have their registered office in Spanish territory.
- Have the effective management headquarters in Spanish territory.
For this purpose, an entity shall be deemed to have its place of effective management in Spanish territory where it radiates the direction and control of all its activities.
The tax authorities may presume that an entity located in any country or territory of zero taxation or considered to be a tax haven has its residence in Spanish territory where its principal assets, directly or indirectly, consist of goods located or rights that are fulfilled or exercised in Spanish territory, or where its main activity takes place in that territory, unless that entity proves that its management and effective management takes place in that country or territory , as well as that the constitution and operation of the entity responds to valid economic reasons and substantive business reasons other than simple securities management or other assets.
Specifically, they will be taxpayers of the Tax, when they have their residence in Spanish territory: All kinds of entities, whatever their form or denomination, provided that they have their own legal personality, except civil companies that have no commercial object. These include, but are not, but are noted:
- Civil companies with commercial purposes
- Commercial companies: public limited liability, collective, labor, etc.
- State, regional, provincial and local societies.
- Cooperative societies and agricultural processing societies.
- Single-person societies.
- Economic interest groups.
- European economic interest groups.
- Associations, foundations and institutions of all kinds, both public and private.
- Public bodies (State Administrations, Administration of Autonomous Communities, Local Corporations, Autonomous Bodies, etc.).
In addition, the following entities, devoid of their own legal personality:
- Investment funds regulated in the Collective Investment Institutions Act.
- Temporary unions of companies.
- Capital-risk funds.
- Pension funds.
- Mortgage market regulation funds.
- Mortgage securitisation funds.
- Asset securitisation funds.
- Investment guarantee funds.
- The communities that own neighborhood mountains in common hand.
- Bank Asset Funds.
Taxpayers will be taxed for all income they obtain, regardless of where it occurred and whatever the payer’s residence.
Who is required to file the Corporation Tax return?
All taxpayers of the company tax are required to file their return on corporation tax, whether or not they have carried out activities during the tax period and whether or not taxable income has been obtained.
Consequently, circumstances such as the entity remaining inactive or that, having activity, have not been generated as a result of the same taxable income, do not exempt the taxpayer from the obligation to file the mandatory declaration.
Specifically, non-profit entities, professional colleges, business associations, official chambers, workers’ unions and political parties, among others, will be required to declare all their income exempt and not exempt.
As the only exceptions to the general obligation to declare, the current legislation provides for the following:
- Entities declared wholly exempted by Article 9.1 of the Corporation Tax Act or which apply to them under this Article.
- Partially exempted entities referred to in Article 9.3 of the Corporation Tax Act that meet the following requirements:
- That your total income does not exceed 75,000 euros per year.
- Non-exempt income does not exceed EUR 2,000 per year.
- That all non-exempt income they earn is subject to withholding.
- Communities holding neighbouring mountains in common hand for tax periods in which they do not have income subject to corporation tax, incur any expense, or make investments that entitle the reduction in the tax base specifically applicable to these taxpayers.
What is the tax period and the accrual of the tax?
> Rule
The tax period, to which the company tax return is to be referred, coincides with the financial year of each entity.
> Particular rules
Even if the financial year has not ended, the tax period is understood to have been concluded in the following cases:
- When the entity is extinct. The termination is understood to occur when the company’s cancellation seat takes place in the Commercial Register, and is therefore required to submit its declaration within 25 calendar days of six months of that cancellation seat.
- When a change of residence takes place of the entity resident in Spanish territory abroad.
- When the transformation of the legal form of the entity occurs and this determines the non-taxation of the resulting entity.
- Where the transformation of the legal form of the entity occurs and this determines the change in its tax rate or the application of a special tax regime.
In no case, the tax period may exceed twelve months.
