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V1000-16 14 March 2016 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · rendimientos del trabajo

Back pay from court rulings is attributed to the tax year in which the judgment becomes final

A trainee civil servant has requested clarification on how to tax back pay received in 2015 following a 2012 court ruling. The DGT indicates that amounts relating to the period prior to the ruling are attributed to the year the judgment becomes final, while subsequent amounts are attributed to the year they became due.

The question raised

Taxation for Personal Income Tax purposes of the amounts received.

The DGT's ruling

Income from employment pending judicial resolution is attributed to the tax period in which the judgment becomes final. If this income spans more than two years, the 40% reduction for a generation period exceeding two years is applied. Income accrued after the judgment is attributed to the fiscal years in which it was due, without entitlement to said reduction.

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