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V0440-24 14 March 2024 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · daños personales

Personal injury compensation and statutory interest are exempt from Income Tax

A civil servant has enquired whether compensation received for an assault and its statutory interest are subject to Income Tax (IRPF). The Directorate General for Taxes (DGT) has ruled that both personal injury compensation and interest for late payment are exempt.

The question raised

Personal Income Tax treatment of the compensation and the interest.

The DGT's ruling

Compensations for civil liability for personal injury, with an amount judicially recognized, are exempt pursuant to Article 7.d) of the Personal Income Tax Law. This exemption is maintained even if the payment is made by the Administration under subsidiary civil liability. Likewise, compensatory interest for the delay in the payment of an exempt compensation is also covered by the exemption.

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