National, international projects and co-productions filmed in Madrid, as in the rest of the Spain’s common territory, can access a tax deduction on Corporation Tax up to 30%, with a maximum refund of 10 million.
In any case, these incentives are applicable to any Spanish producer registered on the Ministry of Culture and Sport’s Film Company Register in charge of the production.
The current legislation that regulates these incentives is the Article 36 of the Law 27/2014, dated the 27th of November, on Corporation Tax (in Spanish) for investments in film and series audiovisual productions, live performances and musical shows. This law has been modified for the last time through the Law 38/2022, of December 27.
International productions
International productions can access tax deductions on Corporation Tax, as provided for in Law 27/2014, of November 27, on Corporate Income Tax, in its article 36.2 and article 39.
The deduction is applicable to the spanish production companies registered on the Ministry of Education, Culture and Sport’s Film Company Register who are managing the foreign production. This means that it’s the “service company” which takes on the executive production and which carries out the tax procedures involved in applying for a tax rebate.
Project types
Feature films, television series, animated films and documentaries.
Amount of the deduction
30% Tax rebate with respect to the first million euros of the base of the deduction, 25% for the rest of the expenditure made in Spain.
Maximum rebate limit
20 million euros for each production carried out. In the case of tv series, the deduction is determined per episode and the limit referred to in the previous paragraph is 10 million euros for each episode produced.
Minimum expenditure made in Spain
The deduction will apply provided that the expenses incurred in Spanish territory are at least 1 million euros, with the following special cases:
- Animation productions: the minimum amount of expenditure incurred in Spanish territory is 200,000 euros.
- Visual effects services: If the producer is responsible for the execution of visual effects services and the expenses incurred in Spanish territory are less than 1 million euros, the deduction will be 30%.
Rebate base
Eligible expenses incurred in Spain: creative staff residing in the country or another European Union state (up to a limit of €100,000 per person), and technical and complementary services.
Procedure
The Spanish service production company must file a corporate tax return, applying the corresponding deduction.
The law includes further details which are not listed here, so we recommend you to read Article 36.2 in its entirety and, in addition, the replies posted by the Spanish Tax Agency. More information can be found here (Spanish).
National productions and Coproductions
Spanish productions and international co-productions can gain access to tax credit on Corporation Tax, as provided for in Law 27/2014, of November 27, on Corporate Income Tax, in its article 36.1 and article 39.
Project types
Feature-length, series and short films of fiction, animation, or documentary.
Amount of the deduction
30% Tax rebate with respect to the first million euros of the base of the deduction, 25% for the rest of the expenditure made in Spain.
Maximum rebate limit
20 million euros for each production carried out. In the case of tv series, the deduction is determined per episode and the limit referred to in the previous paragraph is 10 million euros for each episode produced.
In the event of a co-production, the amounts will be determined, for each co-producer, based on their respective percentage of participation in the co-production.
The amount of all tax incentives received may not exceed 50% of the production cost, although this limit is raised in some cases:
- 85% for short films.
- 80% for productions directed by a newcomer, productions shot entirely in one of the Spanish co-official languages, and productions directed exclusively by people with a disability equal to or greater than 33%.
- 75% for productions directed exclusively by female directors; productions with special cultural and artistic value that require exceptional financial support; documentaries and animated works with a production budget of no more than €2,500,000.
- 60% for cross-border productions financed by more than one EU Member State and involving producers from more than one Member State; and international co-productions with Ibero-American countries.
Rebate base
The total cost of production and the cost of copies, advertising, and promotion financed by the producer (with a limit of 40% of production costs).
At least 50% of the deduction base must correspond to expenses incurred in Spanish territory. The base of the deduction will be reduced by the amount of subsidies received to finance the investments that generate the right to deduction.
Requirements for accessing deduction
That the production obtains the corresponding certificate of nationality and the certificate proving its cultural character.
That a new, perfect copy of the production be delivered to the Spanish Film Library or the film library corresponding to each Autonomous Community.
Procedure
The deduction will be generated in each tax period from the production cost therein incurred, although it will be applied starting from the tax period in which the production of the work ends.
Deduction for participation in the financing of works
Access to deduction will also be granted to those entities financing Spanish audiovisual works, when amounts are contributed as financing, to defray all or part of the production costs without acquiring intellectual property or other rights with respect to its results, it being necessary in all cases for the property to correspond to the production company. (article 39, Law 27/2014).
The law includes further details which are not listed here, so we recommend you to read Article 36.1 in its entirety and, in addition, the replies posted by the Spanish Tax Agency. More information can be found here (Spanish).
