Skip to content
Back to index
V0090-16 14 January 2016 · SG de Tributación de las Operaciones Financieras Criterion in force
IRPF · rendimientos del capital mobiliario

Life insurance surrender proceeds are taxed as investment income in the tax year they become due

A taxpayer inquired about the timing for declaring income obtained from the lump-sum surrender of a deferred life insurance policy. The Directorate General for Taxes (DGT) ruled that such income constitutes investment income and must be attributed to the tax period in which the amount becomes due to the policyholder.

The question raised

Temporal imputation of returns derived from surrender in the Personal Income Tax.

The DGT's ruling

The surrender of a life insurance policy generates returns on movable capital. The temporal imputation is made in the tax period in which the amount becomes due to the policyholder upon requesting the surrender. This exigibility is determined according to insurance regulations and the provisions of the policy, and must be imputed to the moment in which the right to its receipt is recognized.

Book your free first meeting