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A query was raised regarding whether financial allowances intended to cover medical expenses not covered by the Health Service or Mutual Insurance are subject to Personal Income Tax (IRPF). The Directorate General for Taxes (DGT) ruled that they are not taxable, provided they are used for medical treatment or the restoration of health.
This ruling provides tax certainty for employees receiving reimbursements for healthcare costs not covered by public or mutual insurance, ensuring these funds are not treated as taxable employment income if used for health purposes.
The tax team reviews your specific situation.
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