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A local council must recover productivity bonuses paid in error following a court ruling. The Directorate General of Taxes (DGT) clarifies whether this refund affects the Income Tax (IRPF) return for the current tax year or the year in which the payments were originally received.
This ruling clarifies the timing for tax adjustments when income is recovered, ensuring that taxpayers report the refund in the tax year the original income was earned rather than when the recovery occurs.
The tax team reviews your specific situation.
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