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V0588-22 21 March 2022 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · exención por trabajos en el extranjero

Requirements for exemption from foreign work income

A Spanish employee seconded to France asks whether the exemption under article 7 p) of the LIRPF applies. The DGT states that the exemption applies only if the worker is a tax resident in Spain and the work is carried out for a non-resident entity or a permanent establishment abroad, assessing whether there is an intragroup service generating profit for the recipient entity.

The question raised

Whether the exemption regulated in Article 7 p) of the Personal Income Tax Law is applicable.

The DGT's ruling

To apply the exemption, the worker must be a tax resident in Spain and effectively perform the work abroad. The recipient of the work must be a non-resident entity or a permanent establishment abroad. If the recipient entity is related to the employer, it must be verified that the service is an intra-group provision that produces an advantage or benefit to the non-resident entity. The country where the work is performed must not be a tax haven and must have an information exchange agreement with Spain.

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