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A taxi driver inquired whether the sale of his auto-taxi licence allows for the application of the retirement reduction under the 7th Additional Provision of the Personal Income Tax Law (LIRPF). The Directorate-General for Taxes (DGT) ruled that if the transfer occurs after having carried out the activity under an active retirement scheme, the cause is the cessation of activity rather than retirement.
This ruling clarifies that taxpayers transitioning from active retirement to full retirement via the sale of business assets cannot claim specific retirement tax benefits if the transfer is legally classified as a cessation of activity.
The tax team reviews your specific situation.
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