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V1532-17 15 June 2017 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · indemnización por despido

Dismissance compensation from an ERE may be exempt without the 180,000 euro cap

A worker consulted on the tax treatment of dismissal compensation received following a judicial ruling related to an ERE. Hacienda responds that, as the ERE was initiated before certain dates, the 180,000 euro cap does not apply.

The question raised

Tax treatment, under Personal Income Tax (IRPF), of the compensation for termination of the employment relationship.

The DGT's ruling

For dismissals derived from Collective Redundancy Procedures (ERE) approved as of March 8, 2009, the exemption applies to the amount not exceeding 45 days of salary per year of service, with a maximum of 42 monthly payments. The 180,000 euro limit provided for in Article 7 e) of the Personal Income Tax Law (LIRPF) does not apply. The excess over the exempt portion is taxed as employment income, and the 30% reduction from Article 18.2 may be applied if the generation period exceeds two years and the amount limits are met.

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