The reform of the cinema law that came into force as of 2015 and that is included in Article 36 Law 27/2014, of 27 November, on Corporate Tax provides great advantages for investors who decide to invest in this industry.
Any investor interested in this type of sector should enter with a participation in an Economic Interest Grouping (AIE) and through this vehicle be able to channel the investment in an audiovisual production.
An AIE is an entity of a commercial nature and legal personality, where the contribution of social capital is not necessary for its creation, and may be of an indefinite or temporary nature. In the event of the existence of debts, the responsibility is of a personal and unlimited nature.
In this type of entity can invest both a natural person and a legal entity. The benefits, losses and tax deductions are applied to each participant as if they were invested directly, which means that this type of participation can be sold to third parties (this sale is only possible at the beginning and during the production of the film). The investment must be made at the time prior to the start of postproduction or during filming, although there are some banking entities in charge of providing advance money to the producer, and which the investor would contribute at a later date.
The tax benefits that it would receive are of an immediate nature after the investment and would materialize at the end of the fiscal year and when the production has the work certificate.