Main tax novelties introduced by law 11-2020, of general state budgets for 2021 (boe of December 31)

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MAIN TAX NOVELTIES INTRODUCED BY LAW 11/2020, ON GENERAL STATE BUDGETS FOR 2021 (BOE OF DECEMBER 31)

INCOME TAX FOR INDIVIDUALS

General income tax scale

Effective January 1, 2021, the scale applied to the part of the general taxable base is modified to determine the full state quota, adding a new tranche to the part of the taxable base that exceeds 300,000 euros to which it will be applied. a rate of 24.50%. The new applicable general scale is as follows:

(Article 63.1 of the LIRPF is modified by article 58 of the LPGE for 2021).

Types of tax on savings in personal income tax

Effective January 1, 2021, the scale applied to the part of the taxable base of savings is modified to determine the full state quota, adding a new tranche to the part of the taxable base of savings that exceeds 200,000 euros at that a rate of 13.00% will be applied.

The new scale applicable to the taxable base of savings is as follows:

Likewise, the scale applicable to the taxable savings base to determine the full autonomous fee is also modified in the same terms indicated.

The applicable scale in this case will be the same as previously reproduced.

For its part, the scale applied to the part of the taxable base of savings is modified to determine the full state quota in the case of those taxpayers who had their habitual residence abroad due to the concurrence of any of the circumstances indicated in the articles 8.2 and 10.1 of the LIRPF. In this case, a new tranche is added to the part of the taxable base of the savings that exceeds 200,000 euros to which a rate of 26.00% will be applied.

Thus, in this case, the scale applicable to the taxable base of savings will be the following:

(Articles 66 and 76 of the LIRPF are modified by article 59 of the LPGE for 2021).

Scale of withholdings and interim income applicable to earned income recipients

With effect from January 1, 2021, the applicable scale is modified to determine the percentage of withholding that should be applied on the income from work derived from labor or statutory relations and pensions and passive assets. A new tranche is added to the part of the base to calculate the withholding rate that exceeds 300,000 euros to which a 47.00% withholding rate will be applied.

Thus, the scale to apply to determine the type of withholding will be the following:

(Article 101.1 of the LIRPF is modified by article 60 of the LPGE for 2021).

Scales applicable to workers posted to Spanish territory

In the special tax regime provided for in article 93 of the LIRPF for workers posted to Spanish territory, with effect from January 1, 2021, the applicable rates are modified to determine the full quota. Two assumptions are distinguished:
First, to the taxable base, except for the part of the same that corresponds to dividends, interests or other income obtained by the transfer to third parties of own capital and capital gains that are revealed on the occasion of the transfer of assets, it is applied the following scale:

(Previously, the percentage applicable to the taxable base from 600,000 euros was 45%).

Second, to the part of the payable part that corresponds to dividends, interests or other income obtained by the transfer to third parties of own capital and capital gains that are revealed on the occasion of the transfer of assets, the following scale is applied:

(A new tranche is created for the taxable base from 200,000 euros to which a rate of 26% will be applied).

Likewise, this special regime modifies -with effect from January 1, 2021- the percentage of withholding or payment on account on work income. Specifically, when the remuneration paid by the same payroll for work income during the calendar year exceeds 600,000 euros, the withholding percentage applicable to the excess will be 47 percent (previously it was 45%).

(Article 93 of the LIRPF is modified by article 61 of the LPGE for 2021).

Reduction limits in the tax base of contributions and contributions to social security systems

With effect from January 1, 2021, different limits are modified in relation to social security systems.

Private insurance that exclusively covers the risk of severe dependency or high dependency:

The set of reductions practiced by all people who pay premiums in favor of the same taxpayer, including those of the taxpayer himself, may not exceed 2,000 euros per year (Previously the limit was 8,000 euros per year).

Contributions to social security systems in which the taxpayer's spouse is a participant, mutualist or holder:

The taxpayer whose spouse does not obtain net income from work or economic activities, or obtains them in an amount less than 8,000 euros per year, may reduce the contributions made to the social security systems of which he is a participant, mutualist or holder in the tax base said spouse.

These contributions will have a maximum limit of 1,000 euros per year (previously the limit was 2,500 euros).

Set maximum limit:

As a maximum joint limit for contributions or contributions to social security systems, the lower of the following amounts will apply:
to. 30% of the sum of the net income from work and activities
individually received in the financial year.
b. 2,000 euros per year (previously the limit was 8,000 euros) As of January 1, 2021, this limit will be increased by 8,000 euros, provided that such
incremento provenga de contribuciones empresariales.
The own contributions that the individual entrepreneur makes to employment pension plans or mutual benefit societies, of which in turn he is a promoter and participant or mutualist, as well as those made to business social security plans or collective insurance of dependency of those who are in turn policyholder and insured, will be considered as business contributions, for the purposes of calculating this limit.
In addition, the limit of 5,000 euros per year for the premiums for group long-term care insurance paid by the company, which already existed previously, is maintained.

(Articles 51.5 and 7 and 52 of the LIRPF are modified by article 62 of the LPGE for 2021).

Extension of the exclusive limits of the objective estimation method

The quantitative limits that have been applied in previous years and that define the scope of application of the objective estimation method for the economic activities included in the scope of application of said method are extended for the year 2021, with the exception of agricultural and livestock activities. and forestry, which have their own quantitative limit by volume of income.

Therefore, the general exclusionary figures will be the following for fiscal year 2021:

• Volume of income in the immediately preceding year exceeding 250,000 euros for all economic activities, except agricultural, livestock and forestry. All operations will be computed, whether or not there is an obligation to issue an invoice. Operations in which there is an obligation to issue an invoice when the recipient is a businessman, may not exceed 125,000 euros.
• Volume of income for the set of agricultural, forestry and livestock activities exceeding 250,000 euros.
• Volume of purchases of goods and services in the immediately preceding year, excluding acquisitions of fixed assets, greater than 250,000 euros.
• (DT 32nd of the LIRPF is modified by article 63 of the LPGE for 2021).

CORPORATE TAX

Limitation on the deductibility of financial expenses

With effects for tax periods that start from January 1, 2021 that have not concluded at the entry into force of this Law and indefinitely, the regulation of the limitation on the deductibility of financial expenses is modified, establishing that To determine the operating profit, the addition of financial income from equity instruments that correspond to dividends will not be taken into account, when the acquisition value of said shares exceeds 20 million euros.

(Section 1 of article 16 of Law 27/2014, of November 27, on Corporation Tax is amended).

Exemption on dividends and income derived from the transfer of securities representing the equity of resident and non-resident entities

With effects for tax periods beginning on January 1, 2021 that have not concluded upon the entry into force of this Law and indefinitely:

• The exemption on dividends and income derived from the transfer of securities representing the equity of resident and non-resident entities is modified, establishing that dividends or participations in profits of entities will be exempt, when the requirement that the percentage of participation, direct or indirect, in the capital or equity of the entity is, at least 5 percent, eliminating the alternative requirement that the acquisition value of the participation be greater than 20 million euros.

(The first paragraph of letter a) of section 1 and letter a) of section 6 are amended in article 21 of Law 27/2014, of November 27, on Corporation Tax).

The amount that will be exempt will be 95 percent of said dividend or income. The management expenses related to such participations will not be deductible from the taxpayer's taxable profit, fixing that their amount is 5 percent of the dividend or positive income obtained.

This limitation will NOT apply to companies that have an INCN lower than 40 million euros and that they are not part of a commercial group, for a period limited to three years, when they come from a subsidiary, resident or not in Spanish territory, established after January 1, 2021.

(New sections 10 and 11 are added to article 21 of Law 27/2014, of November 27, on Corporation Tax).

• The regulation that establishes that dividends or profit shares will not be included in the tax base in the part that corresponds to the positive income that has been included in the tax base, joining, that for these purposes, the amount of dividends or profit shares will be reduced by 5 percent for management expenses related to such shares, unless the circumstances established in section 11 of article 21 of this Law concur.

(Section 10 of article 100 of Law 27/2014, of November 27, on Corporation Tax is amended).

• On the other hand, the regulation is modified that establishes that to calculate the income derived from the transfer of the participation, directly or indirectly, the acquisition value will be increased by the amount of the social benefits that, without effective distribution, correspond to Income that would have been imputed to the partners as income from their shares or participations in the period of time between their acquisition and transmission joining, for these purposes, that the amount of social benefits referred to in this paragraph will be reduced by 5 percent for management expenses related to said participations.

(Section 12 of article 100 of Law 27/2014, of November 27, on Corporation Tax is amended).

• Se regulates the transitory tax regime for holdings with an acquisition value greater than 20 million.

(A fortieth transitory provision is added to Law 27/2014, of November 27, on Corporation Tax).

International economic double taxation: dividends and profit shares

With effects for tax periods that start from January 1, 2021 that have not concluded at the entry into force of this Law and indefinite validity, in relation to the deduction to avoid international economic double taxation: dividends and participations in Benefits:

• In the regulation that contains the LIS, where it is established as a requirement for the application of this deduction that the direct or indirect participation in the capital of the non-resident entity is, at least, 5 percent, the alternative requirement that the acquisition value of the participation be greater than 20 million euros is eliminated.

(Letter a) of section 1 of article 32 of Law 27/2014, of November 27, on Corporation Tax is modified).

• On the other hand, it is added that, to calculate the full quota dividends or profit shares will be reduced by 5 per cent for management expenses related to such shares. Said reduction will not be practiced in the case of dividends or participation in profits in which the circumstances established in section 11 of article 21 of this Law concur. The excess over said limit will not be considered a tax deductible expense, without prejudice of the provisions of section 2 of article 31 of this Law.

(Section 4 of article 32 of Law 27/2014, of November 27, on Corporation Tax is amended).

• A second paragraph is incorporated that establishes that will not be subject to deletion The amounts that must be included in the individual tax bases by application of the provisions of section 10 of article 21 of this Law.

(Article 64 of Law 27/2014, of November 27, on Corporation Tax is modified).

Deduction for investments in Spanish productions of feature films and short films and series

In relation to the deduction for investments in Spanish productions of feature films and short films and of audiovisual fiction, animation or documentary series:

• It is established that for the application of this deduction the required certificates are binding for the AEAT regardless of its issue date. On the other hand, a section 7 is created in article 39 of Law 27/2014 by which the application of the deduction is extended of sections 1 and 3 of article 36 of Law 27/2014 to taxpayers who participate in the financing of said productions.

(The thirty-first final provision of the General State Budget Law for 2021 modifies letter a ') of section 1 of article 36 of Law 27/2014 on Corporation Tax).

• It is established that the increased limit of the deduction to 50% also applies (in addition to R + D + i) for deductions for film productions, audiovisual series and live performances of performing arts and music when these deductions exceed 10% of the total tax reduced in the deductions to avoid international double taxation and discounts.

(The thirty-first final provision of the General State Budget Law for 2021 also modifies sections 1 and 5 of article 39 of Law 27/2014, on Corporation Tax).

VALUE ADDED TAX

Modifications introduced in Law 37/1992, of December 28, on VAT by the PGE Law
2021:

Location of service provision: rule of effective use

Article 68 of the LPGE for 2021 establishes that, with Article 68 of the LPGE for 2021 establishes that, with and indefinite validity, article 70 is modified. Two LIVA, to stop apply the special rule of effective use to the services that are understood to be performed, according to localization rules, in the Canary Islands, Ceuta and Melilla.

(Article 70 of Law 37/1992, of December 28, on Value Added Tax is modified).

Tax rate applicable to beverages with added sweeteners

Article 69 of the LPGE 2021 establishes that, with effect from January 1, 2021 and indefinite validity, article 91.uno.1.1º LIVA is modified, increasing the tax rate applicable to soft drinks, juices and soft drinks with sugars or added sweeteners, which go from taxing 10 percent to 21 percent.

(Number 1 of section one of article 91 of Law 37/1992, of December 28, on Value Added Tax is modified).

Limits for the application of the simplified regime and the special regime of agriculture, livestock and fishing

Article 70 of the LGPE 2021 establishes that, with effect from January 1, 2021 and indefinite validity, the thirteenth transitional provision LIVA is modified in order to extend for the 2021 period the limits for the application of the simplified regime and the regime special agriculture, livestock and fishing.

EQUITY TAX

Scale of assessment of the Wealth Tax

Effective January 1, 2021, the scale applied to the part of the taxable base of the Tax is modified so that the rate applicable to the last tranche becomes 3.5% (previously it was 2.5%). %).

Thus, the new applicable scale is the following:

(Article 30 of the Wealth Tax Law is modified by article 66 of the LPGE for 2021).

Indefinite nature of the Wealth Tax

After the repeal of the second paragraph of the sole article of Royal Decree-Law 13/2011, of September 16, which reinstates the Wealth Tax, on a temporary basis, the indefinite nature of the Wealth Tax is restored.

TAX ON ECONOMIC ACTIVITIES

With effects for the tax periods that begin as of the entry into force of this Law and indefinite validity, Royal Legislative Decree 1175/1990, of September 28, is modified, which approves the Rates and the Tax Instruction on Economic Activities, as follows:

• The commercialization activities of general supplies (electricity and gas) are specifically classified:

The title of the Grouping 15 of the First Section of the Rates introducing the commercialization and is worded as follows: Group 15. Production, transport, distribution and commercialization of electricity, gas, steam and hot water.

The title of the group 151, of Group 15, of the First Section of the Rates, adding the  commercialization. It is drawn up as follows: Group 151. Production, transportation, distribution and commercialization of electrical energy.

• A new heading is added, within group 151 of Group 15, of the First Section of the Rates: Section 151.6. Commercialization of electrical energy.

The Group 152, of Group 15 of the First Section of the Rates (incorporating the commercialization) that is drawn up as follows: Group 152. Manufacturing, distribution and marketing Of gas.

In addition, two new headings are introduced in group 152:

• Section 152.1. Gas Manufacturing and Distribution.
• Section 152.2. Gas Marketing.

A heading is created for large commercial surfaces that are not mainly dedicated to clothing or food and that until now they lacked their own epigraph. They are given a similar treatment to the other shopping centers, within Group 661, "Integrated mixed trade or large stores":

A new heading, in group 661, of the First Section of the Rates, which is thus worded:

Section 661.9. Another mixed or integrated trade in large areas, understood as that carried out in a specialized way in establishments with a useful surface for the exhibition and sale to the public equal to or greater than 2,500 m² of products such as those related to DIY and the equipment of the household, home and office furnishings, electronic items and household appliances, auto items, sports items or others.

Note: Useful surface for exhibition and sale to the public shall be understood as that in which
display items for direct sale, whether covered or not and effectively usable by the
consumer.

Is modified the 2nd common note to group 661, of the First Section of the Rates, introducing a large area, which is drawn up as follows:

2nd. For the purposes of calculating the quotas of this group, the entire area of the establishment (large warehouse, hypermarket, popular warehouse or other large surface), including areas for offices, covered parking, warehouses, etc. Likewise, the areas occupied by third parties by virtue of assignment of use or by any other title will be counted. However, discovered surfaces will not be counted regardless of their destination.

• It adds a new heading in group 664, of the First Section of the Rates, for the new activity of supplying energy to electric vehicles through recharging points installed anywhere, whether on public roads, gas stations, public and private garages or in any other location, with the following wording:

Epígrafe 664.2. Puntos de recarga de vehículos eléctricos.