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V0953-18 11 April 2018 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · becas exentas

Master's scholarships are only tax-exempt if for an official degree and meeting entity requirements

A doctor inquired whether a scholarship received from a non-profit entity for a training master's degree is exempt from Personal Income Tax (IRPF). The Directorate-General for Tax (DGT) ruled that exemption depends on the studies leading to an official degree and the entity adhering to the principles of merit, ability, and competitive selection.

The question raised

Whether said scholarship is subject to taxation. Whether the exemption under Article 7 j) of the Personal Income Tax Law is applicable.

The DGT's ruling

For the scholarship to be exempt pursuant to Article 7.j) of the Personal Income Tax Law (LIRPF), the studies must be formal and lead to the attainment of an official University Master's degree. Furthermore, if the entity is non-profit, the call for applications must be public, aimed at generic collectives, and conducted through a competitive selection process. If these requirements are not met, the amount shall be taxed as employment income.

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