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V0685-16 19 February 2016 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · renta mundial

The taxation of disability pensions from Germany in Spain depends on the Double Taxation Convention and the nature of the pension

A resident in Spain has enquired whether their disability pension originating from Germany is exempt from Personal Income Tax (IRPF). The Directorate General for Taxes (DGT) indicates that exemption depends on whether the disability is equivalent to absolute incapacity or severe disability, and whether the paying entity acts as a substitute for the German Social Security system.

The question raised

Whether said pension originating from Germany is exempt from taxation in Spain under Personal Income Tax.

The DGT's ruling

Una pensión por invalidez del extranjero goza de exención según el artículo 7.f) de la LIRPF si se cumplen dos requisitos: que el grado de incapacidad sea equiparable a la incapacidad absoluta o gran invalidez, y que la entidad que paga la prestación sea sustitutoria de la Seguridad Social según la normativa alemana. Estos requisitos deben acreditarse ante la Administración Tributaria.

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