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New guides on the latest Spanish tax and immigration developments.
Practical tools for informed decision-making.
A taxpayer inquired whether compensation received following their mother's death due to negligence in a care home is exempt from Personal Income Tax (IRPF). The Directorate General of Taxes (DGT) ruled that, as the amount has not been legally or judicially recognised, the compensation must be taxed as a capital gain.
This ruling clarifies that compensation for personal injury is only exempt from income tax if the amount is formally established through legal or judicial means; otherwise, it is treated as taxable capital gains.
The tax team reviews your specific situation.
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