Back to index
V4777-16 10 November 2016 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · deducibilidad

Remuneration for commercial agent duties performed by a director is deductible for Corporation Tax under certain conditions

A single-member company has requested clarification on whether the monthly remuneration paid to its director for commercial agent duties is deductible. The Directorate General for Taxes (DGT) has ruled that it is deductible, provided that the requirements for accounting registration, accrual, correlation between income and expenditure, and documentary justification are met.

The question raised

1) Whether the remuneration received monthly for the work performed in the entity is deductible in its Corporate Income Tax.

The DGT's ruling

Expenses for administrator remuneration for work performed are tax deductible provided they meet the conditions of accounting registration, accrual basis, and substantiation. Such expenses constitute the consideration for the functions performed, even if they are distinct from the status of administrator. As they involve related parties, the valuation must be carried out at their normal market value.

Book your free first meeting