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V1735-15 2 June 2015 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · indemnización por despido

Payment of dismissal indemnity is attributed to the year it becomes due, not the year it is paid

A German national resident in Spain since 2014 seeks advice on the taxation of a dismissal payment received in January 2014 following a termination in 2013. The DGT rules that the indemnity must be attributed to 2013, the year it became due, not the year of payment.

The question raised

Taxation of severance pay.

The DGT's ruling

Employment income is imputed to the tax period in which it is due to the recipient. Severance pay must be imputed to the year in which the termination of the employment relationship occurred, regardless of whether payment was made in the following year due to company practices or German regulations. If the income does not derive from an activity carried out in Spanish territory, it will not be taxed in Spain as it is not considered income obtained in Spain.

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