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V0458-16 5 February 2016 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · inmovilizado intangible

Amortisation over a defined useful life cannot be deducted as irreversible depreciation

The applicant asks whether the termination of a retail network contract allows for the intangible asset to be deducted as an irreversible loss. The DGT rules that this does not constitute impairment, but rather amortisation that should have been deducted over the contract's useful life.

The question raised

Whether, due to the signing of new contracts and the termination of the previous one, it is considered that an irreversible depreciation of the recognized, tax-deductible intangible asset has occurred.

The DGT's ruling

The termination of the contract does not constitute an irreversible depreciation, but rather a greater effective depreciation during its term. The intangible asset must be amortized for tax purposes within its defined useful life, pursuant to Article 1.5 of the RIS. If the entity deducted less than what was due, it may rectify its tax returns for the corresponding years.

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