Numerous tax changes have been introduced in the PGE 2022 published on December 29, 2021. On that day, Law 22/2021, on the General State Budget for the year 2022, was published. These came into force on January 1, 2022. It should be remembered that these are budgets with historical maximum spending ceilings.
The law includes numerous tax measures related to various taxes, which are summarized by our tax planning experts.
Tax changes in the PGE 2022
The aforementioned law includes numerous tax innovations related to various taxes, which are summarized below.
Personal Income Tax. IRPF.
New limitations are introduced to the reductions for contributions to social welfare systems. It is worth remembering that already in the year 2021 there was a significant reduction in the maximum amount allowed to be deducted by those who had pension plans. They went from €8,000 to €2,000. However, the maximum amount of reduction amounted to €10,000, provided that the increase came from corporate contributions.
In addition, the maximum annual limit for all the reductions made by all the persons who pay premiums for private insurance policies that exclusively cover the risk of severe dependency or major dependency in favor of the same taxpayer was also reduced from €8,000 to €2,000. Including those of the taxpayer himself.
The maximum annual amount of contributions to social welfare systems eligible for reduction is reduced from €2,000 to €1,500. This applies with the new budgets from January 1, 2022. This limit will be increased by €8,500, i.e. up to €10,000. Provided that such increase comes from employer contributions. Or from employee contributions to the same social welfare instrument to which the employer contributions have been made. That is to say, the same pension plan, company social welfare plan, mutual social welfare fund, etc. For an amount equal to or less than the respective company contribution.
The exclusion limits of the objective estimation method are extended. The quantitative limits that have been applied in previous years and that delimit the scope of application of the objective estimation method are extended for the fiscal year 2022:
- Volume of income, in the immediately preceding year greater than €250,000 (general).
- For the volume of income, €125,000, when an invoice is to be issued and the recipient is a businessman or professional.
- Volume of income for all agricultural, forestry and livestock activities exceeding €250,000.
Tax changes in the PGE 2022 in Corporate Income Tax
A minimum taxation regulation is introduced. Both in Corporate Income Tax and in Non-Resident Income Tax (permanent establishment) for certain taxpayers. Specifically, a minimum taxation of 15% is introduced for taxpayers who meet the following requirements.
Firstly, their net turnover must be at least 20 million euros during the 12 months prior to the date on which the tax period begins.
Or, that they are taxed under the tax consolidation regime regardless of their net turnover.
This minimum taxation will not be applied in the following cases:
In which taxpayers are taxed at the tax rates provided for in sections 3, 4 and 5 of Article 29 of the LIS. That is to say, the rates: 10%, 1% and 0%,
Entities of Law 11/2009, of October 26, 2009, which regulates Listed Real Estate Investment Companies (SOCIMI).
Limits with exceptions
The minimum taxation for newly created entities will be 10% and not 15%.
It will be 18% in the case of credit institutions and entities engaged in the exploration, research and exploitation of hydrocarbon deposits and subway storage.
In the case of cooperatives. The minimum net tax liability cannot be less than the result of applying 60% to the gross tax liability calculated in accordance with the provisions of Law 20/1990, on the Tax Regime of Cooperatives.
Rules for determining the minimum net tax liability
In the first place, the gross tax liability will be reduced by the amount of the applicable tax credits. Including those regulated in Law 19/1994, of modification of the Economic and Fiscal Regime of the Canary Islands. And in the amount of the deduction provided for in Article 38 bis of Law 27/2014).
Next, the deductions for double taxation regulated in articles 31, 32, 100 and the twenty-third transitory provision of Law 27/2014 will be applied. Respecting the limits applicable in each case if as a result of the above operations:
An amount lower than the minimum liquid quota calculated as indicated in the preceding paragraphs results. This amount will have, as an exception, the consideration of minimum net tax liability.
Or, it results in an amount higher than the amount of the minimum net tax liability calculated as indicated in the preceding paragraphs. The remaining applicable deductions will be applied. With the limits applicable in each case, up to the amount of said minimum net tax liability.
The deductions whose amount is determined in accordance with the provisions of Law 20/1991, of modification of the fiscal aspects of the Economic Fiscal Regime of the Canary Islands. And in Law 19/1994, of modification of the Economic and Fiscal Regime of the Canary Islands. In both cases, they will be applied, respecting their own limits. Even if the resulting net tax liability is less than the aforementioned minimum net tax liability.
The amounts not deducted by application of the above rules may be deducted in the following tax periods in accordance with the regulations applicable in each case.
When the sum of the withholdings on account, the payments on account and the fractioned payments exceed the amount of the net tax liability. Or, as the case may be, of the minimum net tax liability, the Tax Administration will proceed to return, ex officio, the excess.
Modification of the Special Regime of Entities dedicated to the renting of housing.
The reduction applicable to income derived from the rental of housing obtained by entities applying the special regime for entities engaged in the rental of housing (“EDAV”) provided for in Chapter III, Title VII of the LIS is reduced from 85% to 40%.
Modification of the Special Tax Consolidation Regime.
The gross tax liability of the tax group will be reduced by the amount of the deductions and allowances provided for in Chapters II, III and IV of Title VI of Law 27/2014. As well as any other deduction that may be applicable. Giving rise to the liquid quota of the same, clarifying, that, in no case, it may be negative.
Tax changes in the PGE 2022 in the Value Added Tax. VAT.
The thirteenth transitory provision of Law 37/1992, of December 28, 1992, on Value Added Tax (VAT) is modified. With this modification the increase to 250,000 euros of the magnitude of 150,000 euros established in the thirteenth transitory provision of the LIVA is extended to 2022. For the purposes of certain exclusion limits of the Simplified Regime and the Agriculture, Livestock and Fishing Regime.
In relation to the Simplified Regime, an exclusion limit of €250,000 of income in the immediately preceding year is established for all business or professional activities, except agricultural, forestry and livestock activities, carried out by the taxpayer. Likewise, the exclusion limit of €250,000 is established for acquisitions and imports of goods and services for all business or professional activities. Excluding those relating to fixed assets, carried out in the immediately preceding year by the taxpayer.
In relation to the Agriculture, Livestock and Fishing Regime, an exclusion limit of €250,000 is established for 2022 for acquisitions and imports of goods and services for all business or professional activities.
Tax on economic activities. IAE.
A new group 863 is added to group 86 of the second section of the Rates of the Tax.
Group 863. Journalists and other information and communication professionals. The taxpayers classified in this group are empowered to obtain, process, interpret and disseminate information or contents. Through any written, oral, visual, digital or graphic media. As well as for the advice and execution of institutional or corporate communication plans.
Tax on Property Transfer and Documented Legal Acts
The scale of taxation of noble titles and grandeur applicable in the modality of documented legal acts is updated by 1%. ITPyAJD administrative documents