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V1754-22 22 July 2022 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · estimación directa

Deductibility of master's degree costs depends on correlation with business income

A translator inquires whether the cost of a master's degree for teaching English classes can be deducted from her professional activity. The Directorate General for Taxes (DGT) indicates that deductibility depends on proving that the expense is linked to the generation of income.

The question raised

Deductibility in Personal Income Tax (IRPF) of the cost of the master's degree for the purposes of determining the net yield of the economic activity carried out.

The DGT's ruling

For professionals under the direct estimation method, the deductibility of expenses requires proof of their correlation with the income from the activity. The verification of such link between the master's degree and the income is a matter of fact to be assessed by the management and inspection bodies. The expense must be properly justified by an invoice or supporting document and recorded in the mandatory books.

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