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V2166-15 15 July 2015 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · rendimientos de actividades económicas

Professional services can be taxable income in IRPF under specific conditions

Hacienda clarifies that remuneration from two working partners in a consultancy society may be considered business income in IRPF if the society provides professional services, the partner actively engages in them and is registered as an autonomous. VAT applicability depends on whether the partner acts independently or under labour subordination.

The question raised

Question raised: A consultation is made regarding the taxation under Personal Income Tax for the remuneration corresponding to the services provided by the two referred partners to the company, taking into account the new wording given to Article 27 of the Personal Income Tax Law by Law 26/2014.

The DGT's ruling

In Personal Income Tax (IRPF), services provided by partners to their company constitute income from economic activities if the activity is professional and the partner is registered in the self-employed regime or a mutual insurance scheme. Regarding VAT, liability depends on a case-by-case analysis of the partner's independence. If the partner does not provide their own resources, is subject to the company's organizational criteria, and their remuneration does not depend on results, the relationship is employment-based and not subject to VAT.

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