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V1257-19 3 June 2019 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · rendimientos del trabajo

Reduction for employment income does not apply if non-employment income exceeds €6,500

A query was raised regarding how to determine the concept of non-employment income for the purpose of applying the reduction under Article 20 of the Personal Income Tax Act (LIRPF). The Directorate General for Taxes (DGT) clarifies that these incomes consist of the sum of net yields, capital gains and losses, and imputed income.

The question raised

Determination of the concept "income, excluding exempt income, other than employment income," contained in Article 20 of the Tax Law.

The DGT's ruling

Income other than employment income is the arithmetic sum of yields, capital gains and losses, and imputed income, both positive and negative. For this calculation, net yields must be used prior to any reduction and without applying legal compensation limits. If this income (excluding exempt income) exceeds 6,500 euros, the reduction provided for in Article 20 of the Personal Income Tax Law cannot be applied.

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