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A taxpayer inquired whether the 40% reduction could be applied across two different years: one for long-term unemployment and another for retirement. The Directorate General for Taxes (DGT) ruled that if retirement benefits are collected early, the tax contingency is deemed to occur at that moment, meaning the reduction can only be applied once.
This ruling limits the ability of taxpayers to split the application of the 40% reduction across different tax periods for different contingencies, reinforcing the principle that the tax event is tied to the moment of benefit collection.
The tax team reviews your specific situation.
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