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A taxpayer inquired whether, upon moving their residence to Melilla, they could apply the tax deduction for income earned in Ceuta and Melilla to all their income. The Directorate General for Taxes (DGT) ruled that the deduction only applies to income obtained within those specific cities, unless certain specific requirements are met after three years of residence.
The ruling clarifies that the tax benefit is territorial in nature, meaning income earned outside Ceuta or Melilla does not qualify for this specific deduction, even if the taxpayer is a resident of those cities.
The tax team reviews your specific situation.
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