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V2702-14 9 October 2014 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · gasto deducible

The administrator's salary is deductible if it corresponds to management services unrelated to their position and is valued at market price

A rental company inquires whether its administrator's salary for administrative head duties is deductible, given that its bylaws state that the position of administrator is unpaid. The DGT responds that only the portion corresponding to rental management services valued at market price is deductible, excluding remuneration for administrative functions.

The question raised

Question raised 1) Whether the amount of the salary received by the administrator for the performance of their work as an administrative head is considered a tax-deductible expense for Corporate Tax purposes.

The DGT's ruling

The administrator's remuneration is deductible for Corporate Tax purposes provided that it corresponds to consideration for management services and is valued at normal market value. The portion remunerating the management and administration duties inherent to the position shall not be deductible, as, since the position is unpaid according to the bylaws, such remuneration would be considered a gratuity. For the expense to be deductible, it must comply with the requirements of accounting registration, accrual, correlation of income and expenses, and documentary justification.

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