Limit for the 15% reduced rate for newly created companies

Access to the 15% reduced rate in Corporate Income Tax (IS) constitutes a relevant incentive for companies starting their economic activity. However, the Directorate General of Taxes (DGT) has specified the requirements necessary for an entity to benefit from this tax rate according to current regulations.

What the DGT has ruled

The inquiry analyzes the possibility of applying the 15% rate established in Article 29.1 of the Corporate Income Tax Law (LIS). The DGT determines that, for an entity to be considered newly created and access this rate, it must carry out an economic activity and not be part of a group of companies under the terms defined by Article 42 of the Commercial Code.

The administration establishes that the group status must be analyzed at two key moments: in the first tax period in which the taxable base is positive and in the immediately following period. If at any of these moments the entity meets the requirements of a group, it loses the possibility of applying the reduced rate.

What it means for you

If your company is in the startup phase of its activity, the 15% tax rate is an available option, but its application is neither automatic nor does it depend solely on the company's age. The ownership structure and the relationship with other entities are decisive.

Companies that, even being newly created, are integrated into a group structure according to the Commercial Code, are excluded from this tax benefit. This implies that the planning of the corporate structure has a direct impact on the entity's tax burden from its first profitable fiscal years.

What should be done

It is necessary to conduct an analysis of the ownership structure before filing the Corporate Income Tax return. It must be verified whether the entity meets the group criteria of the Commercial Code to avoid errors in determining the applicable tax rate. Since the group status is evaluated in the first fiscal year with a positive taxable base and in the following one, monitoring these periods is fundamental to ensure regulatory compliance.