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V1336-21 11 May 2021 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · imputación temporal

Professional career back pay is imputed to the tax year in which it becomes due and may be eligible for the 30% reduction

An interim civil servant of the Generalitat Valenciana inquired about the taxation of professional career back pay received in 2020 for the periods from 2015 to 2019. The DGT determines that these must be imputed to the period of enforceability and analyzes the application of the reduction for 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 is imputed to the tax period in which it becomes due, as determined by the administrative resolution of recognition. Since it was received in a tax year different from that of its enforceability due to circumstances not attributable to the taxpayer, a supplementary tax return for the corresponding period must be filed. Furthermore, the 30% reduction is applicable if the generation period exceeds two years and no other similar reductions have been applied in the previous five tax periods.

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