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V0214-21 10 February 2021 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · atrasos

Withholding tax rate for overtime arrears cannot exceed 15%

A local council enquired whether its employees could request a 37% withholding rate on overtime payments from the previous year, rather than the 15% rate applicable to arrears. The Directorate-General for Taxes (DGT) ruled that requesting higher rates in this specific case is not permitted.

The question raised

Whether a withholding rate of 37% can be applied to overtime and other arrears, as in the case requested by its municipal employees.

The DGT's ruling

The withholding rate for arrears imputed to previous fiscal years is a fixed rate of 15% pursuant to Article 80.1.5 of the RIRPF. The possibility of requesting higher withholding rates applies only when the withholding is determined by the general procedure set forth in Articles 82 et seq. of the Regulation. Therefore, a request for a higher rate for arrears is not admissible.

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