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V0374-21 25 February 2021 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · rendimientos del trabajo

Fixed compensation for volunteer firefighters is taxable as employment income

A local council has requested clarification on whether fixed amounts paid to volunteer firefighters for travel and lost hours can be exempt as allowances. The Directorate General for Taxes (DGT) has ruled that, as these are fixed amounts based on hours rather than reimbursements of actual expenses, they constitute employment income subject to tax.

The question raised

Taxation under Personal Income Tax (IRPF).

The DGT's ruling

Economic compensations to volunteer firefighters are considered income from employment because they derive from the provision of personal services. The per diem regime of the Tax Regulation is not applicable because it requires an employment or statutory relationship. As these are fixed amounts based on hours invested and not a strict reimbursement of expenses, they cannot be considered expenses incurred on behalf of a third party. Therefore, they are subject to withholding as income from employment.

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