Said ruling establishes the specification, for both limited liability companies and corporations, of the remunerated nature of the post of director in the company by-laws as the sole requirement for deductibility. Therefore, in accordance with said ruling, even when the requirements set by the aforementioned Supreme Court decision for the consideration of the expense as obligatory and necessary are not met, they will be considered fiscally deductible as they are deemed to be an accounting expense, recorded in the company profits and losses and do not constitute a gift.
The DGT ruling is based on the fact that the Revised Corporate Income Tax Law is more flexible than Law 61/1978 as regards expense deductibility insofar as it includes those expenses which, although not legally obligatory, were undertaken to obtain income for the entity.
With this ruling, it would appear that Spanish company unease as to whether or not they had to modify their company by-laws to comply with the High Court’s aforementioned certainty requirement has been laid to rest.
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