Enróllate Films
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Tax incentives

Up to 54% tax rebate for shooting in the Canary Islands

The Canary Islands offer one of Europe's most competitive audiovisual tax frameworks: a 50% rebate on the first €1M of spend (up to 54% in certain cases), 45% on the rest, zero-rate IGIC for feature films and series, and a 4% corporate tax rate in the ZEC. These are the figures published by the Canary Islands film commissions.

54%

Top rebate on the first €1M

50% as a general rule

45%

Rebate on remaining spend

€36M

Max rebate per feature film

€18M per episode in series

4%

Corporate tax rate in ZEC

vs 25% elsewhere in Spain

Overview

A framework designed to attract international production

The Canary Islands audiovisual rebate, zero-rate IGIC for the shoot, the Canary Islands Special Zone (ZEC) and the Canary Islands Investment Reserve (RIC) make the islands one of Europe's most competitive tax destinations for audiovisual production. Productions such as The Rings of Power, Jack Ryan and The Witcher have filmed here.

The incentives

The four main incentives

Not every incentive applies to every production: it depends on the type of work, the budget and the spend in the Canary Islands. Which incentives are combined is decided by each production's tax advisor.

01

Canary Islands audiovisual rebate (Art. 36 LIS + Law 19/1994)

The headline incentive. A direct corporate tax rebate, available both for Spanish productions (art. 36.1 LIS) and for foreign productions that hire a local production or production services company (art. 36.2 LIS). The Canary Islands raise the rates applied elsewhere in Spain (30% / 25%) to 50% / 45%, and to 54% on the first €1M in certain cases.

  • 50% on the first €1M; up to 54% in certain cases (for foreign productions, when Canary Islands spend exceeds €1.8M)
  • 45% on spend above the first €1M
  • Cap: €36M rebate per feature film
  • Series: €18M rebate per episode
  • Foreign productions: minimum €1M spend in the Canary Islands (€200,000 for animation) and a minimum budget of €2M
  • Cultural certificate; Spanish productions also need the ICAA Spanish nationality certificate and the Canary Islands Audiovisual Work Certificate

02

Canary Islands Special Zone (ZEC) — 4% corporate tax

The ZEC is a low-tax zone authorised by the European Commission. A newly created audiovisual company registered in the ZEC pays 4% corporate tax, compared with 25% elsewhere in Spain. It is compatible with the audiovisual rebate.

  • 4% corporate tax rate
  • Minimum investment in fixed assets of €100,000 in Tenerife and Gran Canaria and €50,000 on the other islands, within the first two years; most audiovisual activities are exempt if they create 6 jobs
  • At least 5 jobs (3 on the other islands) within the first six months
  • A newly created company with at least one director resident in the Canary Islands
  • Further advantages in IGIC, Transfer Tax and Stamp Duty

03

Canary Islands Investment Reserve (RIC)

Allows companies to reduce their corporate tax base by up to 90% of the undistributed profit from establishments in the Canary Islands, provided it is invested in the islands within a maximum of three years. Since 2007 it can also be invested in Canary Islands audiovisual productions.

  • Reduction of up to 90% of undistributed profit
  • Investment in assets, companies or funds that invest in the Canary Islands
  • A maximum of three years to make the investment
  • Can be invested in productions holding the Canary Islands Audiovisual Work Certificate

04

Zero-rate IGIC for the shoot

There is no VAT in the Canary Islands: the indirect tax is IGIC, with a 7% general rate. Goods and services for shooting feature films and fiction, animation or documentary series can be zero-rated, with prior authorisation from the Canary Islands Tax Agency.

  • 0% IGIC on goods and services for shooting feature films and series
  • Requires prior authorisation from the Canary Islands Tax Agency
  • Standard IGIC rate: 7% (VAT elsewhere in Spain: 21%)
  • Commercials are not zero-rated (Tenerife Film)

Example

Numerical example

Simplified example showing how the audiovisual rebate applies. Final figures depend on the exact spend profile and must be validated with the tax advisor before budgeting.

Scenario

Foreign production with a total budget of €3M and €2M of eligible spend in the Canary Islands. Because Canary Islands spend exceeds €1.8M, the first €1M qualifies for 54%.

First €1M eligible × 54%
€540,000
Second €1M eligible × 45%
€450,000
Total rebate
€990,000
Saving on total spend in the Canary Islands
~50%

Indicative figures. The rebate is applied to spend that's actually incurred and evidenced. As a general rule, total public support for a production cannot exceed 50% of its cost. Caps: €36M per feature film and €18M per episode in series.

Requirements

Key requirements

Requirements vary by incentive. These are the most common ones to account for from the budgeting stage:

  • 01Foreign productions: minimum spend of €1M in the Canary Islands (€200,000 for animation) and a minimum budget of €2M.
  • 02Foreign productions: hire a production or production services company that is tax-resident in the Canary Islands and registered with the ICAA.
  • 03Foreign productions: cultural certificate, with a minimum score of 15 points.
  • 04Spanish productions: a production company that is tax-resident in the Canary Islands and registered with the Canary Islands audiovisual companies registry, or a co-production with one.
  • 05Spanish productions: ICAA Spanish nationality and cultural certificates and the Canary Islands Audiovisual Work Certificate, which requires a minimum number of shooting days in the islands (for example, 11 days for a feature film under €2M).
  • 06Spanish productions: at least 50% of the deduction base must be spend incurred in Spain.
  • 07Eligible spend: costs incurred in the Canary Islands and directly linked to the production, including creative staff tax-resident in Spain or the European Economic Area, technical industries and other suppliers.

Our role

Where we come in

We are not tax advisors. We take care of locations and the shoot on the islands, and we work with the Canary Islands service companies that handle the incentive.

01

Your brief

Tell us about the project: type of production, dates, islands and what you need to shoot.

02

Service company

For foreign productions, the rebate is claimed by a production or service company tax-resident in the Canary Islands. We work regularly with the islands' service companies.

03

Locations

We scout and propose locations, and take care of permits and shoot logistics.

04

Incentive

The cultural certificate and the rebate are handled by the Canary Islands production company and its tax advisor.

FAQ

Frequently asked questions

What's the minimum spend required in the Canary Islands?+

For foreign productions (art. 36.2 LIS), €1M of eligible spend in the Canary Islands (€200,000 for animation) and a minimum budget of €2M. Spanish productions (art. 36.1) have no such floor, but they need the Canary Islands Audiovisual Work Certificate, which requires a minimum number of shooting days in the islands, and at least 50% of the deduction base must be spend incurred in Spain.

Which costs are eligible?+

Costs incurred in the Canary Islands and directly linked to the production: creative staff tax-resident in Spain or another European Economic Area country, technical industries and other suppliers. Gran Canaria Film publishes the detailed list of eligible costs.

Can I combine the audiovisual rebate with the ZEC?+

Yes. According to Tenerife Film, the rebate of up to 54% is compatible with the 4% ZEC rate. The RIC and zero-rate IGIC have their own rules. Each production's structure is designed by its tax advisor.

When is the rebate applied?+

For foreign productions, in the corporate tax return for the period in which the production service is completed. For Spanish productions, the production company applies it in its corporate tax return. The payment timeline depends on each case; the production's tax advisor will confirm it.

Does it apply to commercials, animation and documentary?+

Animation and documentary, yes: the rebate covers feature films and fiction, animation and documentary series (for foreign animation, the minimum Canary Islands spend is €200,000). Commercials are not among those formats, and Tenerife Film excludes them from zero-rate IGIC.

What paperwork do I need from day one?+

A production brief with a preliminary budget, tentative shoot schedule, synopsis and basic tech sheet. From there, the production's tax advisor works out which incentives apply and the likely savings. Formal paperwork (cultural certificate, contracts, invoices) is structured during pre-production.

What if my production doesn't reach €1M?+

If it's a foreign production, it doesn't meet the art. 36.2 minimum (€1M in the Canary Islands and a €2M budget; €200,000 for animation). It can consider a co-production with a Canary Islands producer to use the Spanish productions regime (art. 36.1) and, for a feature film or series, zero-rate IGIC.

Can the rates change?+

Yes: they change with each reform of the law, as has already happened. That's why this page links to the film commissions' sources and shows the date of its last review. It's best to lock the tax structure before the shoot.

Informational content. Every production must be validated with a tax advisor.

Sources

Figures reviewed on 27 October 2026.

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