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V2738-14 13 October 2014 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · entidad urbanística de conservación

Conservation entities are subject to Corporation Tax and their expenses are deductible under certain conditions

A conservation urban entity has requested clarification on whether its operating expenses are deductible for Corporation Tax purposes. The DGT has determined that, by carrying out an economic exploitation activity, the entity is subject to the tax and its expenses are deductible provided they meet the requirements of accounting registration, accrual, correlation, and substantiation.

The question raised

Whether the expenses incurred by the consulting entity in the performance of its functions are deductible for Corporate Income Tax purposes.

The DGT's ruling

The entity is a taxpayer for Corporate Income Tax purposes by carrying out an economic exploitation of conservation services. Expenses are deductible provided they have been accounted for, comply with the rules of accrual and correlation, are supported by documentary evidence, and are not specifically non-deductible expenses. In partially exempt entities, expenses attributable exclusively to exempt income are not deductible.

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