Before, hardly anyone knew what a Business Angel or a startup was, now it's rare that someone doesn't know about these concepts within the Spanish business landscape. For this reason, Spanish regulations have established various incentives and deductions in order to continue promoting investment and entrepreneurial activity. All these proposals dedicated to the entrepreneurial ecosystem were published after the approval of the Law 14/2013 on Support for Entrepreneurs and their Internationalization.The most important of the published proposals is the Deduction for investment in new or recently created companies, a tax incentive whose main objective is to encourage investment by Spanish companies. This deduction has a double aspect or application: - A Deduction in the personal income tax contribution at the time of the investment.- An exemption from possible capital gain in personal income tax at the time of the divestment.
What percentage of the tax return can taxpayers be deducted?
Up to 30% of the amounts that have been invested in the period for the subscription of shares or shares in new or recently created companies.
Important and essential fact to consider: The deduction can only be applied to shares or shares subscribed as of September 20, 2013 (the date on which Law 14/2013 came into force).
The maximum base of the deduction will be 60,000 euros per year and will consist of the value of the acquisition of the shares or shares subscribed. Initially, the proposed deduction was 20% and with a limit of 50,000 euros per year, but as of January 1, 2018, it was improved to 30% and with a limit of 60,000 euros.However, they will not form part of the deduction: - The amount of shares or shares acquired with the balance of the savings-company account, to the extent that said balance would have been subject to another deduction.- The amounts satisfied by the subscription of shares or participations, when any of the deductions established by their respective Autonomous Community are made in the exercise of their powers in personal income tax.
What requirements must an entity meet in order to apply the deduction for investment in new or recently created companies?
- The entity or company in which it has been invested must be in a corporate form (Public Limited Company, Limited Liability Company, Labor Limited Company or Labor Limited Liability Company), and not be listed in any organized market. This requirement must be met during all the years of the trend of action or participation.- The entity or company must carry out an economic activity that has the personal and material means for its development. In particular, it may not have as its activity the management of movable or real estate assets, in any of the tax periods of the entity that have ended prior to the transfer of said shareholding.- The amount of own funds of the entity or company in which it is invested may not exceed 400,000 euros at the beginning of the tax period of the same in which the investor or taxpayer acquires the shares or shares. When the entity is part of a group of companies, the amount of own funds is will refer to the group of entities belonging to that group.
What conditions must be met in order to practice the Deduction?
- The shares or shares in the entity must be acquired by the taxpayer either at the time of the incorporation of the company or through a capital increase carried out in the three years following said constitution and remaining in your assets for a term of more than 3 years and less than 12 years.- The direct or indirect participation of the taxpayer or investor, together with that held in the same entity by their spouse or any other person linked to the taxpayer by some type of kinship, cannot, on any day of the natural years of tendency in participation, exceed 40% of the entity's share capital or their voting rights.- It should not be shares or shares in an entity through which the same activity that was previously carried out through another ownership is carried out. The basis of the deduction is the amount of shares or shares acquired with the balance of savings-company accounts to the extent that the balance would have been subject to another deduction. It should be noted that the deduction for savings-business accounts was abolished as of January 1, 2015. When the taxpayer, investor or Business Angel transfers shares or shares and opts for the application of the exemption, only the part of the reinvestment that exceeds the total amount obtained in the transfer of those shares or shares will form part of the base of the deduction corresponding to the new shares or shares subscribed. Under no circumstances may the deduction be applied for new shares or shares as long as the amounts invested do not exceed the said amount.Important fact: For the application of the deduction, it will be necessary to obtain a certification issued by the entity indicating that the entity complies with the requirements indicated above for the entity in the tax period in which the shares or shares are acquired.
How to complete the Deduction for investment in new or recently created companies?
The data capture window must reflect, for up to two entities: the total amount of investment in shares or shares with a limit of 60,000 euros for all investments and the entity's NIF.
Divestment
As we have mentioned before, to consolidate the deduction for investment in newly created companies, it is necessary that the taxpayer does not keep the shares or shares acquired for more than 12 years, so he is obliged to carry out the divestment to maintain the tax benefit of the deduction practiced. Source: Tax Agency (EAT)
