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V1638-22 8 July 2022 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · indemnización por despido

Specific limit applied to the 30% reduction for redundancy payments between €700,000.01 and €1,000,000

The taxpayer asks how to calculate the 30% reduction limit for a redundancy payment ranging from €700,000.01 to €1,000,000. The DGT clarifies that a special calculation applies to this amount range and that the limit is unique even if the payment is made in instalments.

The question raised

In the event of receiving severance pay, how is the limit set forth in Article 18.2 of the LIRPF calculated for the purposes of applying the 30 percent reduction, in the event that the amount of said income is between 700,000.01 euros and 1,000,000 euros.

The DGT's ruling

For income from the termination of an employment relationship between 700,000.01 and 1,000,000 euros, the 30% reduction applies to the amount that does not exceed the result of subtracting 300,000 euros from the difference between the income and 700,000 euros. If the amount is equal to or greater than 1,000,000 euros, the reduction shall be zero. In the event of fractional payment, the limit is unique and applies until the accumulated non-taxable amount reaches said specific limit.

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