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V1445-14 30 May 2014 · SG de Tributación de las Operaciones Financieras Criterion in force
IRPF · rentas exentas

Insurance benefits for disability resulting from illness are not exempt from Income Tax

A query was raised regarding whether insurance benefits for total permanent disability caused by illness are exempt from Income Tax (IRPF). The Directorate General for Taxes (DGT) ruled that they are not exempt, as illness is not classified as an accident under the Insurance Contract Act.

The question raised

Whether said benefit is exempt from Personal Income Tax.

The DGT's ruling

The exemption under Article 7.d) of Law 35/2006 applies to compensation for personal injury derived from accident insurance. Since the disability is recognized due to illness, the benefit does not derive from accident insurance and does not enjoy the exemption.

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