Spain | Finance and Tax Law Newsletter | October 2021

CORPORATE INCOME TAX (“CIT”)

> Spanish Supreme Court judgment on the deduction of advertising costs to promote events of exceptional public interest

> Spanish Supreme Court judgment on offsetting tax loss carryforwards

>  Central Economic and Administrative Tribunal (“TEAC”) resolutions refining the criteria on offsetting tax loss carryforwards

> General Directorate of Taxes (“DGT”) resolution on the effects on the capitalization reserve of distributing interim dividends charged against the profits for the financial year

> DGT resolution on transferring shares in a company engaging in the production, transmission and distribution of electricity

> TEAC resolutions on the maximum amount for offsetting tax loss carryforwards in corporate income tax payments on account

PERSONAL INCOME TAX (“PIT”)

> Spanish Supreme Court judgment on the calculation base for the deductible expense of annual depreciation of a property acquired free of charge

> Judgment of the National High Court. Residence of spouse and underage children

PROPERTY TRANSFER TAX AND STAMP DUTY (“ITPAJD”)

> Binding resolution of the DGT on the taxable base for stamp duty on novations of mortgage loans involving the extension of the maturity date

> Spanish Supreme Court order on canceling a financial lease due to the early exercise of the purchase option

VALUE ADDED TAX (“VAT”)

> Spanish Supreme Court judgment on banning the vertical direct effect of EU directives

> TEAC resolution extending to collective investment funds its doctrine on the unlawfulness of including pension funds in the Register of Large Enterprises (Registro de Grandes Empresas) CJEU judgment on Case C-294/2020, of September 9

OTHER DEVELOPMENTS Form 720: potential breach of EU law