Canary Islands RIC: Investment Guide, Requirements, and Benefits

1. What are Capital Goods for RIC Purposes?

Capital goods are tangible fixed assets acquired or imported as an initial investment.

3. Requirements for Land Acquisition as Initial Investment

To qualify as an initial investment, land (built or unbuilt) must not have previously received RIC benefits and must be used for:

• Promoting social housing for lease by the promoter.
• Purchase of land for development activities (Divisions 1-4 of business tax).
• Commercial or tourist areas: acquisition aimed at rehabilitating tourist accommodation in declining tourism areas.

4. Operational Term and Exceptions for Capital Goods

Capital goods must be operational within 3 months of purchase or import. Exceptions include:

• Land for promoting social housing for lease.
• Goods requiring longer installation time, provided activities are undertaken immediately and continuously.

8. What is Considered a Benefit from Stores in the Canaries for RIC Purposes?

Benefits are derived from economic activities, including the transmission of assigned assets.

10. RIC Inclusion in Balance Sheets and Unavailability Period

The RIC must be included in balance sheets with a separate, appropriate title and remain unavailable while the materialized goods remain in the company.

11. Maximum Timeframe for RIC Materialization

Amounts allocated to the RIC must be materialized within 3 years from the tax accrual date for the year it was established.

12. Eligible and Ineligible Benefits for RIC

Eligible: Benefits derived from economic activities in the Canary Islands and the disposal of assets subject to economic activity.
Ineligible: Disposal of non-affected tangible fixed assets and loans from financial assets.

13. Elements for RIC Materialization

• New and used fixed-asset items (used items must contribute to improving company technology).
• Subscription of Canary Islands public debt.
• Subscription of shares or participation in companies operating in the Canary Islands (indirect materialization).

16. Purpose of the RIC

The RIC was implemented to stimulate investment by local businesses using their own resources, strengthening self-financing for companies operating in the Canary Islands.

19. Formal Requirements for Taxpayers Utilizing RIC

Taxpayers must submit an investment plan for the reserve, attached to the tax return for the period in which the planned reduction is applied.