The DIC: the 25 % Canary investment credit — what qualifies, the 70 % ceiling and when it beats the RIC

Every Canary business that buys a new machine, a van, a server or a workshop this year has a 25 % tax credit waiting for it, and a surprising number of small companies on Fuerteventura have never claimed it. The Deducción por Inversiones en Canarias — the DIC — takes a quarter of what you paid for a new fixed asset straight off your corporate tax bill, or off your income tax if you are self-employed, up to 70 % of the year's tax; whatever does not fit carries forward for fifteen years. Its better-known sibling, the RIC we explained last week, reduces the taxable base; the DIC reduces the tax itself, and the two can never be used on the same asset. Here is what qualifies, how the ceiling works after the Supreme Court's 2024 ruling, and a decision rule for choosing between them.

A credit against the tax, not a reduction of the base

The distinction decides everything, so it comes first. Corporate tax in 2026 runs at 19 % on the first €50,000 of profit and 21 % above it for a company with turnover under a million euros, 23 % for larger small companies and 25 % in general, as our salary-or-dividends guide sets out. The RIC lets you set aside up to 90 % of the profit you keep in the company and not pay tax on it, provided you invest the reserve within three years: the saving is your tax rate times the reserve — 19 to 25 cents per euro. The DIC works at the other end of the return. You compute the tax as usual and then subtract 25 cents for every euro invested in a qualifying asset, whatever rate you pay. For a micro company at 19 %, a euro of DIC is worth more than a euro of RIC; for a company at the general 25 % the two are worth the same, and the choice turns on flexibility.

Where the 25 % comes from, and why the rules are from 1995

The DIC is the Canary version of a deduction that disappeared from the mainland thirty years ago. The old corporate tax law gave every Spanish company a 5 % credit on new fixed assets; when that law was replaced at the end of 1995, the 1994 Canary fiscal law had already provided that the islands would keep the credit "until an equivalent replacement is enacted" — and none has been. On top of that frozen 5 %, the Canary economic and fiscal regime adds 80 %, with a floor of 20 percentage points: 5 + 20 = 25 %. The ceiling follows the same logic. The 1995 regime capped investment credits at 35 % of the year's net tax; the Canary rule lifts every cap by 80 % with a floor of 35 points, so 35 + 35 = 70 % of the cuota líquida — the tax after double-taxation credits and bonuses — in any one year. On La Palma, La Gomera and El Hierro the floor rises to 45 points for investments covered by those islands' 2016 development law, when EU state-aid rules allow: 80 %.

For years the tax authority applied a lower ceiling of 50 %, reading the reference regime differently. In April 2024 the Supreme Court settled the question: the frozen 1995 text and its 1982 regulation govern the DIC, and the ceiling is 70 % — a reading the AEAT's own 2024 corporate-tax manual and 2025 income-tax manual now reproduce. If your adviser is still applying 50 %, the difference is worth a conversation.

What qualifies

The credit is for new tangible fixed assets used in the business, located and kept in the Canary Islands. In broad terms the eligible families are buildings and constructions, machinery, installations and tools, transport equipment other than vehicles a partner or manager could use personally, furniture and fittings, and computer equipment. Land never qualifies, on its own or as part of a building's price; the value of a plot is stripped out before the 25 % is applied. "New" means, in broad terms, an asset put into service for the first time: a machine bought new from a dealer, a van from the factory, a fit-out installed for you.

The base of the credit is the full agreed price, excluding interest and indirect taxes: IGIC is not part of it, financing costs are not part of it. Between related parties the base cannot exceed the arm's-length price. The credit belongs to the tax year in which the asset enters operation, not the year you order or pay for it; the AEAT's practical pages phrase it as the year the asset is made available to you, and where delivery and start-up straddle a year-end the timing deserves a look. Equipment bought under a leasing contract can qualify under conditions, with the percentage prorated to the contract's length — a detail to check before signing.

Three obligations come attached. The amount must be booked as a fixed asset. The asset must stay in operation in your own business for five years, or its useful life if shorter, without being sold, rented out or handed to a third party — a company whose trade is renting out equipment keeps the credit, provided the tenants are unrelated and the contracts are not finance leases. And the same investment can never earn the credit in two companies.

A second-hand machine can also qualify, under a rule of its own since 1992: used machinery, installations and tools, computer equipment, and transport equipment other than personal-use vehicles, when the purchase brings an evident technological improvement to your business — shown by a lower unit cost of production or a better product or service — and the seller certifies that the asset never earned the credit before. The rate and the ceiling are the same 25 % and 70 %.

Who can claim it

Companies with their tax domicile in the Canary Islands, and mainland or foreign companies for the investments of a permanent establishment they run in the islands — a branch in Puerto del Rosario earns the credit on its Fuerteventura assets even if the head office is in Madrid, with the Canary ceiling applied separately from the head office's own credits.

Self-employed professionals and sole traders claim it too, in their income tax return, provided they compute their business income by direct assessment (estimación directa, normal or simplified); the law leaves module-based taxpayers out unless a regulation lets them in, which in practice it has not. The 70 % ceiling is measured on the whole income-tax liability, state and Canary halves together, not only on the part that comes from the business — the central tax tribunal settled that in 2015 — after the deductions for investing in new companies and for heritage assets. One incompatibility to remember: the general 5 % income-tax deduction for reinvesting profits in new assets is declared incompatible with the DIC and with the RIC.

The 70 % ceiling and the fifteen years

A first example. A micro company in Corralejo makes a €60,000 profit in 2026 and puts a €40,000 machine into service in November, bought new, IGIC excluded. Corporate tax before credits: 19 % of €50,000 plus 21 % of €10,000 = €11,600. The DIC is 25 % of €40,000 = €10,000, but the ceiling is 70 % of €11,600 = €8,120. The company pays €11,600 − €8,120 = €3,480 this year — 5.8 % of its profit — and carries the remaining €1,880 forward, to be used within the same ceiling in the following years — fifteen of them.

The same machine through the RIC. Reserving €40,000 of the profit instead would cut the taxable base from €60,000 to €20,000 and the tax from €11,600 to €3,800: a saving of €7,800, all of it this year, but the €40,000 must stay in the company as a locked reserve for five years, materialised in assets that stay for five more, with the notes to the accounts to prove it. The DIC's €10,000 is €2,200 more, spread over two years, with no reserve, no locked profit and no three-year plan.

A big project, small profit. The same company builds a €200,000 workshop: credit €50,000, ceiling still €8,120 a year, so at today's profit the credit takes six years to use — well inside the fifteen. A company at the general 25 % rate with a €400,000 profit has a €100,000 tax bill and a €70,000 ceiling, enough to absorb the credit on €280,000 of investment in a single year.

A new company with no profit yet does not lose the credit: in broad terms, the count of the years in which it may be used is deferred to the first year that shows a profit, within the statute of limitations.

DIC or RIC? The decision rule

The two incentives are incompatible on the same asset — the RIC's own text says so — but they are not exclusive of each other: the usual pattern in a well-advised Canary company is a RIC materialised in the building, the land for listed uses, the new jobs or the 2025 rental-housing door, and a DIC on the machinery, vehicles and equipment bought outside the plan. When one asset could go either way, four questions decide it.

• What rate do you pay? At 19 or 21 % the DIC's flat 25 % is worth more per euro than the RIC's rate-times-reserve; at 25 % they are equal.
• How large is the investment against the year's tax? The DIC cannot exceed 70 % of the tax in any year and the rest waits; the RIC can wipe out up to 90 % of the taxable profit at once. A €300,000 programme in a company with a €20,000 tax bill is RIC territory.
• Do you need the profit? The RIC requires the profit to be kept and locked; the DIC is indifferent to what you do with it — dividends included.
• Do you invest first or save first? The DIC rewards an investment already made; the RIC rewards a decision to invest within three years, including investments made in advance.

A company starting a new project with staff and premises may find that neither is the first question: the ZEC's 4 % rate is a regime of its own, and the autónomo-or-SL choice comes before both.

The other Canary-boosted credits, in one paragraph

The same 80 %-plus-20-points formula lifts the general corporate-tax credits when the activity is carried out in the islands, and the AEAT's summary table lists them: technological innovation at 45 % instead of 12 %, research and development from 45 % upwards, Spanish film and audiovisual production at 54 % on the first million and 45 % above it, and the credit for hiring workers with a disability at €11,700 or €15,600 per person-year instead of €9,000 or €12,000. They share a joint ceiling of their own, higher than the mainland's; they are the subject of another piece.

Where we come in

Our tax desk in Caleta de Fuste and Costa Calma checks which of your 2026 purchases qualify, computes the credit and the ceiling on your real figures, decides asset by asset between the DIC and the RIC, and files the return with the credit and its carry-forward properly tracked — and reviews recent returns for credits that were never claimed. See tax advisory and accounting advisory, or book a consultation — we reply within one business day.

Common questions

What is the DIC and how much is it worth?
The Deducción por Inversiones en Canarias is a 25 % tax credit on new tangible fixed assets bought for a business in the Canary Islands — machinery, vehicles, equipment, buildings excluding the land. It is deducted from corporate tax, or from income tax for the self-employed in direct assessment, up to 70 % of the year's tax; the excess carries forward for fifteen years.

Can I apply the DIC and the RIC at the same time?
Not on the same asset: the law makes the two incompatible for the same goods. A company can use the RIC for some investments and the DIC for others, and that combination is common. Per euro, the DIC's 25 % is worth more than the RIC at the 19 % or 21 % rates and the same at 25 %; the RIC can absorb far larger amounts in one year.

Does a second-hand machine qualify?
Yes, if it is machinery, installations and tools, computer equipment or non-personal transport equipment, if it brings an evident technological improvement — a lower unit cost or a better product — and if the seller certifies it never earned the credit before. The 25 % and the 70 % ceiling are the same.

What happens if I sell the asset before five years?
The credit is conditional on the asset staying in operation in your business for five years, or its useful life if shorter, without being sold, rented or ceded. Selling it earlier means, in practice, returning the credit with late-payment interest; a company whose business is renting equipment to unrelated customers keeps it.

Facts verified in September 2026 (Law 20/1991 on the Canary fiscal regime, article 94, as amended by Law 8/2018; Law 19/1994, article 27.12 and transitional provision four, as amended by RDL 15/2014; Law 61/1978 on corporate tax, article 26 in the wording of Law 41/1994; Royal Decree 241/1992, article 2; Personal Income Tax Act, Law 35/2006, articles 68.2 and 69.2; Supreme Court judgment 605/2024 of 10 April 2024, appeal 1299/2022; the AEAT's corporate-tax manual 2024 and income-tax manual 2025). Figures are worked examples on 2026 rates; your own will differ.