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V1561-18 6 June 2018 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · salarios de tramitación

Back pay is attributed to the year the court ruling becomes final

A taxpayer has enquired about how to regularise back pay and the repayment of unemployment benefits following a dismissal challenge. The DGT indicates that back pay must be declared in the year the ruling becomes final, and any benefits repaid must be excluded from the tax return where they were previously incorrectly included.

The question raised

The manner in which received income must be regularized.

The DGT's ruling

Back pay constitutes income from employment and is attributed to the tax period in which the judicial ruling determining the entitlement or amount becomes final. Regarding the refund of unemployment benefits or severance pay, as these are undue income, their amount must be excluded from the tax return in which they were originally included. The regularization of these amounts is carried out through the rectification of the tax returns.

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