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A query was raised regarding the taxation and timing of recognition for a regional subsidy intended to cover the flat-rate social security contribution. The Directorate General for Taxes (DGT) has ruled that this constitutes income from an economic activity and must be recognised either when it accrues or when it is received, depending on the accounting method chosen.
This ruling clarifies the tax treatment for self-employed individuals receiving regional aid for social security payments, ensuring consistency with the classification of economic activity income.
The tax team reviews your specific situation.
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