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V0193-22 7 February 2022 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · residencia fiscal

Foreign earnings may be exempt if LIRPF art. 7. p requirements are met

A Spanish tax resident working in Iraq for a French company asks whether these income are taxable. The DGT states that residents are taxed on worldwide income, but considers the possibility of applying the exemption for foreign work.

The question raised

Whether taxation is required in Spain on income from employment generated in Iraq.

The DGT's ruling

If the taxpayer is a tax resident in Spain, they are taxed on their worldwide income. Income from work performed abroad may be exempt if the services are provided to a non-resident entity, the work is effectively performed outside of Spain, and an tax of an identical or analogous nature to the Personal Income Tax (IRPF) is applied in the country of origin, provided it is not a tax haven. The exemption is subject to an annual limit of 60,100 euros.

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