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A City Council inquires whether the financial aid for the replacement of glasses due to breakage received by a tax official is subject to Personal Income Tax. The DGT indicates that it will not be taxed if it is intended for treatment or the restoration of health and is not covered by the Health Service or Mutual Insurance.
Question posed: Tax treatment in Personal Income Tax of said aid.
Aid for illness expenses not covered by the Health Service or Mutual Insurance, intended for treatment or the restoration of health, is not considered income. If the aid is intended to alleviate the recipient's economic situation rather than providing healthcare, it constitutes employment income subject to tax. In this case, the aid shall be excluded from taxation if it meets the requirements of being intended for the restoration of health and not being covered by public healthcare or mutual insurance.
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