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V0192-16 20 January 2016 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · retenciones

Back pay from court rulings excluded from the calculation of the withholding tax base

A query was raised regarding how to calculate the withholding tax rate in 2015 following the receipt of variable remuneration pending from previous years via judicial proceedings. The DGT ruled that back pay should not be included when determining the total amount of remuneration for the current year.

The question raised

Calculation of the withholding percentage to be applied in the year 2015 on the remuneration of workers to be paid during said year.

The DGT's ruling

To determine the withholding rate, the total amount of remuneration that the taxpayer will normally receive during the calendar year must be calculated, excluding back pay. Amounts not paid due to a judicial ruling are imputed to the period in which the judgment becomes final. Therefore, variable remuneration received as back pay for previous years is not included in the initial calculation of the withholding rate for the current year.

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