RIC – Reserve for Investments in the Canary Islands (RIC)

The strongest yet least understood tax instrument of the Canary Islands.

What is the RIC?

The Reserve for Investments in the Canary Islands (RIC) is a central element of the Canary Islands’ Special Tax Regime (REF). It allows companies and self‑employed professionals operating in the Canary Islands – including Fuerteventura – to significantly reduce their tax burden by allocating profits tax‑free and later converting them into approved investments.

RIC is not a “bonus” but an EU‑compliant tax instrument designed to promote economic development in the Canary Islands.

Why the RIC is particularly relevant for Fuerteventura

Fuerteventura offers ideal conditions for RIC‑eligible investments:

• strong investment dynamics

• high demand in construction, renovation, tourism and services

• low IGIC (7%)

• competitive operating costs

• many small and medium‑sized enterprises

RIC supports exactly the types of investments that naturally occur on Fuerteventura:

• real estate

• renovations

• machinery

• vehicles

• business expansion

• tourism infrastructure

• operational equipment

RIC is therefore a location advantage that many are unaware of – and one that AMV INTERNATIONAL REALTY explains in a clear and structured way for companies and investors on Fuerteventura.

How the RIC works

Companies can allocate part of their profits tax‑free, provided that this amount is invested within a defined period into approved investments in the Canary Islands.

Core principle:

• profits → allocated tax‑free → invested later → tax burden significantly reduced

RIC rate:

Up to 90% of undistributed profits can be reserved tax‑free.

RIC is one of the strongest tax instruments in the entire EU.

Requirements for using the RIC

The RIC can be used by:

• SL

• SLNE

• SA

• self‑employed (under certain conditions)

• ZEC companies (combinable)

Basic requirements:

• registered seat in the Canary Islands

• effective management in the Canary Islands

• profits must be generated in the Canary Islands

• investment must take place in the Canary Islands

• compliance with deadlines (typically 3 years)

Approved investments (RIC‑eligible)

RIC can be applied to a wide range of investments:

• real estate (office, business premises, tourism use, rental)

• renovations (business‑related)

• machinery, equipment, vehicles

• IT infrastructure

• tourism projects

• business expansion

• acquisition of shareholdings (under conditions)

• creation of new jobs

Fuerteventura note:

RIC is particularly strong in the areas of real estate and renovation, as these investments naturally occur on the island.

Tax impact of the RIC

The RIC significantly reduces the tax burden:

• corporate tax: effectively close to 0% on reserved profits

• income tax (self‑employed): substantial reduction

• combinable with ZEC (4% corporate tax + RIC)

RIC therefore:

• promotes investment

• strengthens liquidity

• reduces long‑term tax burden

• accelerates business growth

RIC & Fuerteventura – practical examples

Typical RIC investments on Fuerteventura:

• purchase of an office in Puerto del Rosario

• renovation of a tourism property

• acquisition of machinery for construction companies

• vehicles for service providers

• IT infrastructure for remote‑work companies

• expansion of a holiday‑rental structure

• acquisition of business premises for gastronomy

RIC fits directly into the economic reality of the island.

RIC & real estate

RIC is one of the few tax instruments that actively supports real estate investments.

RIC‑eligible:

• new construction

• renovation

• acquisition of business properties

• tourism use

• business‑related rental

Not RIC‑eligible:

• purely private real estate

• pure capital investment without business use

RIC & ZEC – combination possible

RIC can be combined with the ZEC:

• ZEC: corporate tax from 4%

• RIC: up to 90% of profits reservable tax‑free

This combination is one of the strongest tax structures in Europe.

For Fuerteventura, this means:

• low tax burden

• strong investment capacity

• significant location advantages

Conclusion

The RIC is one of the most important yet least explained tax instruments of the Canary Islands. For Fuerteventura, it offers:

• substantial tax reduction

• investment incentives

• real estate and business advantages

• combination with ZEC

• perfect alignment with the island’s economic reality