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V1313-21 11 May 2021 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · rendimientos del trabajo

Back pay for professional career progression is attributed to the period of entitlement and may qualify for the 30% reduction

An interim civil servant received back pay for professional career progression in 2020, covering the years 2015 to 2019. The DGT has ruled that these earnings must be attributed to the period in which they became due and that they may benefit from the tax reduction applicable to income with a generation period exceeding two years.

The question raised

Taxation of the aforementioned back pay in Personal Income Tax (IRPF).

The DGT's ruling

Back pay must be imputed to the tax period in which it becomes exigible, as determined by the administrative resolution of recognition. Since it is received in a period different from its exigibility due to circumstances not attributable to the taxpayer, a supplementary tax return must be filed. Likewise, the 30% reduction is applicable if the generation period exceeds two years and no other similar reductions have been applied in the previous five periods.

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