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V0931-16 10 March 2016 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · valor razonable

Expenses from fair value adjustments of hedge accounting may be tax-deductible in the financial year of their accounting recognition

Companies have queried whether expenses arising from changes in the fair value of derivative instruments recorded in 2014 are tax-effective. The DGT has ruled that these expenses are deductible in the financial year in which they are accounted for, provided they do not result in lower taxation than would apply under the accrual principle and that the expense is not time-barred.

The question raised

Question posed: Whether the aforementioned expense recorded in the accounts in the 2014 fiscal year, derived from changes in the fair value of derivative instruments produced in the same 2014 fiscal year, has tax effectiveness.

The DGT's ruling

The expense recorded in the 2014 fiscal year for fair value adjustments of hedges has tax effectiveness in said year if it derives from an accounting expense pursuant to Article 10.3 TRLIS. If the expense arises from an error in previous fiscal years, its attribution in the year of recording is valid provided that the original fiscal year is not time-barred and does not result in taxation lower than that which would proceed from the accrual principle. Furthermore, if the hedge is linked to indebtedness, its effects must be computed to determine the net financial expense under Article 20 TRLIS.

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