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A query was raised regarding whether the exemption from severance pay is lost when an individual returns to work for the same company. The DGT has ruled that the presumption of a lack of genuine termination does not apply if the new employment contract begins after three years.
This ruling provides legal certainty for companies regarding the tax treatment of severance payments when rehiring former employees after a significant period, confirming that the three-year threshold prevents the presumption of a non-genuine termination.
The tax team reviews your specific situation.
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