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V1520-24 20 June 2024 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · rendimientos del trabajo

Loans to financial institution employees with below-market interest rates constitute benefits in kind

A credit institution employee inquired whether a mortgage loan with preferential conditions constitutes a benefit in kind. The DGT ruled that it does and must be valued based on the price offered to the general public.

The question raised

Valuation of benefits in kind for Personal Income Tax purposes.

The DGT's ruling

Loans granted by financial institutions to their employees with interest rates lower than the market norm constitute benefits in kind. Their valuation shall not be determined by the difference from the legal interest rate, but rather by the difference between the interest paid and the price offered to the public for a loan of the same nature. The price offered to the public allows for the deduction of ordinary or common discounts, such as general promotions or discounts for similar groups, provided they do not exceed 15% or 1,000 euros annually.

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