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V2093-17 4 August 2017 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · rendimientos del trabajo

Withholding tax on prizes in kind must be made in the name of the minor recipient

A query was raised regarding who holds the title for withholdings or payments on account when winners of drawing or literature competitions are minors. The DGT has ruled that the title belongs to the prize winners themselves, regardless of their status as minors.

The question raised

Following the previous inquiry regarding the subject to withholding of the prize amounts (checks for school supplies), the question is now raised regarding the ownership of the withholdings on prizes awarded to minors.

The DGT's ruling

Since Personal Income Tax (IRPF) taxes the acquisition of income by the taxpayer, the ownership of withholdings or payments on account belongs to the prize winners. These payments must be made in the name of the minor contest winners. Being a minor does not alter the ownership of the income obtained.

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