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V2887-14 29 October 2014 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · doble imposición internacional

Deduction of Moroccan source tax on corporate income possible

A Spanish company asked whether it had sufficient documentation to deduct corporate tax withheld in Morocco for services rendered. The DGT confirms that deduction is possible if the income is included in the taxable base and the tax paid is supported by admissible evidence.

The question raised

Whether sufficient documentation is available regarding the tax withholding applied, in order to proceed with the deduction thereof in the 2012 Corporate Income Tax.

The DGT's ruling

The entity must include in its tax base the income obtained and taxed abroad. It is entitled to deduct the tax effectively paid in the period in which the withholding is applied, provided that it is a tax of an identical or analogous nature to Corporate Income Tax. The accreditation of the withholding is a matter of fact that must be proven through the means admitted by Law, with the Administration being responsible for assessing the evidence presented.

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