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V1292-18 17 May 2018 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · retribución en especie

Christmas hampers and low-interest loans classified as benefits in kind for Income Tax purposes

A query was raised regarding whether loans, civil liability insurance, and Christmas hampers constitute benefits in kind. The DGT has determined that Christmas hampers and loans with interest rates below the legal rate are considered benefits in kind, whereas the classification of civil liability insurance depends on whether there is an employment relationship and if it covers professional risks.

The question raised

Whether the loan, the insurance, and the Christmas hamper are considered remuneration in kind for Personal Income Tax (IRPF) purposes.

The DGT's ruling

The provision of Christmas hampers constitutes remuneration in kind as it is not exempt. Loans granted at an interest rate lower than the legal interest rate are considered income in kind, valued by the difference between said rate and the legal rate. Civil liability insurance premiums are not considered remuneration in kind if an employment relationship exists and the insurance exclusively covers occupational risks or worker accidents.

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