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V0910-19 26 April 2019 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · imputación temporal

Wage differences from final court rulings are taxed in the year the ruling becomes final

A taxpayer received wage differences in 2018 for higher-category duties performed since 2013 following a court ruling. The DGT has determined that this income must be taxed in 2018 and that the reduction for income with a generation period exceeding two years may apply.

The question raised

Temporal attribution in Personal Income Tax and application of the reduction under Article 18.2 of Law 35/2006.

The DGT's ruling

Income from employment pending judicial resolution shall be attributed to the tax period in which the resolution becomes final. If the period during which such income was generated exceeds two years and is attributed to a single period, the 30% reduction established in Article 18.2 of the Personal Income Tax Law shall apply, subject to a limit of 300,000 euros per annum. The reduction shall be applied to the amount of the gross reducible income.

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