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V1169-14 28 April 2014 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · responsabilidad civil

Personal injury compensation is exempt if the amount is legally or judicially recognised

A query was raised regarding the Personal Income Tax (IRPF) treatment of civil liability compensation following a workplace accident. The Directorate General for Taxes (DGT) states that for such compensation to be exempt, it must relate to personal injury and the amount must be legally or judicially recognised.

The question raised

Question raised: Taxation of the compensation in the Personal Income Tax (IRPF).

The DGT's ruling

For civil liability compensation to be exempt income, it must be for personal injury and its amount must be legally or judicially recognized. The judicially recognized amount includes resolutions by judges or intermediate formulas with judicial intervention, such as a judicial settlement. If the amount is not judicially determined, the compensation is taxed as a capital gain in the general tax base.

Apply this to a real case

What is published here, applied to a company or a specific case. The first meeting is free.

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