Spain: The DGT allows credits for environmental investment to be claimed without modifying the self-assessments for the years in which the investments were made

Spain - 28 / 02 / 2024

In a recent binding ruling, the DGT has relaxed its position and allowed environmental credits to be claimed within the maximum application period of 15 years, even where the investments were made in years that have already been inspected.

Article 39 of the Revised Corporate Income Tax Law -TRLIS- (Legislative Royal Decree 4/2004, of March 5, 2004) envisaged a tax credit for investment in assets intended for the protection of the environment (among others, investments in facilities to reduce atmospheric or noise pollution or for the minimization, recovery and treatment of industrial waste). This credit is not envisaged in the current Corporate Income Tax Law -LIS- (Law 27/2014, of November 27, 2014) and therefore cannot be claimed in respect of investments made in fiscal years commencing on or after January 1, 2015.

For this credit to be generated, the suitability of the investments made had to be validated by the competent tax authority through the issue of a certificate; and the DGT (in, among others, its rulings V2807-15, V3399-13, V1509-14, and V2396-12) and some courts have been accepting the possibility of the credit being claimed in a tax period subsequent to that in which the investment was made, provided that the aforementioned validation certificate had been requested prior to the start of the period within which the tax return must be filed (and within the maximum period stipulated by law for application of the credits, which is 15 years).

On June 30, 2022, however, the DGT published two rulings (V1510-22 relating to the credit for disability, and V1511-22 relating to the credit for R&D&I) in which it concluded that the claiming of credits corresponding to prior years required modification of the self-assessments for such years (newsletters for July and August 2022) and that this should in all cases be done within the statute of limitations period (4 years, which is less than the maximum period for applying the credits).

However, on February 13, 2024, the DGT issued a new ruling (V0012-24) relating to the credit for investment in assets intended to protect the environment, in which, for this type of credit specifically, it reverted to the previous, more favorable position.

The ruling request concerned a case in which investments had been made between 2008 and 2014, for which the validation certificate had not been requested at the time, meaning that the credit could not be claimed. Having requested the certificate in a subsequent year, the interested party asked in its ruling request whether, in accordance with the position adopted in rulings V1510-22 and V1511-22, (i) it is necessary to rectify the original return and, furthermore, (ii) whether this can only be done in respect of periods which have not become statute-barred.

The DGT concluded as follows:

Environmental investment credits can be claimed within a maximum period of 15 years as from the point at which the investment was made, without it being necessary to rectify the self-assessment for the year in which the investment was made, i.e. in the first self-assessment to be submitted once the corresponding environmental certificate has been obtained.
The fact of the investments having been brought into operation in a fiscal year which has been inspected by the tax authorities does not prevent the environmental credit from being claimed in a subsequent year.
The 10-year period that the tax authorities have in which to review the credit is counted as from the day following the end of the period in which the self-assessment in which the credit is claimed is required to be presented.

In short, according to this position and as a general rule, it would be possible to claim in forthcoming tax returns credits corresponding to investments becoming operational in the period January 1, 2008 through to December 31, 2014 (credits corresponding to investments brought into operation in 2008 can be claimed, at the latest, in the self-assessment for 2023 to be filed this coming July – for companies whose fiscal year coincides with the calendar year).