Back to index
V2644-14 7 October 2014 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · bonificación

99% Corporate Tax relief for waste management companies with fully public capital

A company wholly owned by a Provincial Council has enquired whether it can apply the tax relief provided in Article 34.2 of the TRLIS to its income. The DGT has ruled that the relief applies to income derived from the direct management of public services under local jurisdiction, but does not extend to financial income or revenue from services provided through entities that are not entirely public.

The question raised

Whether the consulting entity may apply the tax relief established in Article 34.2 of the TRLIS to the income derived from the aforementioned activities.

The DGT's ruling

To apply the 99% tax relief, both subjective requirements (wholly public capital) and objective requirements (income from services within local jurisdiction) must be met. The tax relief applies to the direct management of the service and to auxiliary or complementary activities, but not to income obtained through other entities with non-wholly public capital. Financial income is not eligible for tax relief, except for surpluses from ordinary treasury necessary for the provision of the tax-relieved services.

Book your free first meeting