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V1899-14 15 July 2014 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · intereses de mora

Late payment interest from insurers taxed as capital gains in the savings tax base

A query was raised regarding the taxation of interest established by the Insurance Contract Act due to delays in indemnity payments. The DGT has determined that this interest is compensatory rather than remunerative, and must therefore be taxed as capital gains.

The question raised

Taxation of the interests under Article 20 of the Insurance Contract Law established by judicial sentence.

The DGT's ruling

The interests under Article 20 of Law 50/1980 are compensatory in nature due to the delay in payment and are not exempt. As they do not constitute returns on movable capital, they must be classified as capital gains pursuant to Articles 25 and 33.1 of Law 35/2006. Since the interests under consultation cover a period exceeding one year, they are included in the savings tax base in accordance with Article 49.1.b).

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