Skip to content
Back to index
V1808-22 29 July 2022 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · base imponible

Tips must be included in the Corporate Tax base and are not subject to VAT if they do not constitute remuneration for services

A taxpayer has queried the tax treatment of tips and management expenses. The Tax Agency clarifies that tips constitute Corporate Tax income based on accounting accrual and are not subject to VAT provided they do not represent consideration for a service.

The DGT's ruling

Income from tips must be included in the Corporate Tax taxable base in the fiscal year in which they are accounting-accrued. Regarding VAT, tips do not constitute taxable transactions if they do not represent remuneration for goods or services provided to the person providing them. Management expenses appear to be deductible provided that the requirements of accounting registration, accrual, and documentary justification are met.

Book your free first meeting