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A taxpayer on temporary disability benefits inquired about the classification of these benefits and whether the RETA social security contributions paid by their mutual insurance company are deductible. The Directorate General for Taxes (DGT) ruled that such benefits constitute employment income and that the payment of contributions by the mutual insurance company is a deductible expense for the economic activity.
This ruling clarifies the tax treatment of temporary disability benefits as employment income and confirms the deductibility of social security contributions paid by mutual insurance companies for self-employed individuals.
The tax team reviews your specific situation.
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