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V0276-14 5 February 2014 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · pensión de invalidez

Swiss disability pension may be exempt in Spain if conditions met

A resident in Spain asks whether to declare their Swiss disability pension and if it qualifies for disability exemption. The DGT states the pension could be exempt if the Swiss entity replaces Social Security and the disability level is equivalent to total or severe incapacity.

The question raised

Whether there is an obligation to file a Personal Income Tax return and whether the Swiss and Spanish disability percentages may be deducted in said return.

The DGT's ruling

The Swiss disability pension shall enjoy an exemption if the degree of incapacity is equivalent to absolute incapacity or severe disability and the paying entity is a substitute for Social Security according to Swiss regulations. To apply the disability minimum, the degree of disability must be proven by means of a certificate or resolution from the competent authority. The obligation to file a tax return will depend on whether the income (excluding exempt income) exceeds the legal limits established in the Personal Income Tax Act (LIRPF).

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