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V1941-20 15 June 2020 · SG de Tributación de las Operaciones Financieras Criterion in force
IRPF · rendimientos del trabajo

Pension scheme benefits are taxed in the tax year they become due to the recipient

A taxpayer inquired about when to report the receipt of a lump sum from an occupational pension scheme following a settlement agreement. The DGT ruled that the timing of the tax liability is determined by the tax period in which the benefit becomes due.

The question raised

Temporal imputation of the benefit received from a pension plan in Personal Income Tax.

The DGT's ruling

Pension plan benefits are considered income from employment and must be included in the general taxable base of Personal Income Tax (IRPF). Temporal imputation is carried out in the tax period in which they become due to the recipient, defined as the moment when the recipient can demand payment. The occurrence of the retirement contingency does not, in itself, determine the timing of taxation; rather, this depends on the established date of receipt. In this case, as the payment was agreed upon and quantified in the year of the settlement agreement, the exigibility arises at that moment, and the imputation corresponds to the 2019 fiscal year.

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