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V1141-16 21 March 2016 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · rendimientos del trabajo

Irregularity reduction does not apply if mutual agreement severance is received over several years

A worker inquired whether the irregularity reduction could be applied to severance pay for mutual agreement termination received in annual instalments. The DGT ruled that since the total amount is not attributed to a single tax period, the reduction does not apply.

The question raised

Application of the reduction for irregularity to the excess of the indemnity that is not exempt.

The DGT's ruling

Amounts resulting from mutual agreement resolutions are considered employment income obtained in a notoriously irregular manner. However, the 30% reduction provided for in Article 18.2 of the LIRPF is only applicable when such income is imputed to a single tax period. Since the payments are distributed over several fiscal years, the reduction cannot be applied.

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