Skip to content
Back to index
V2173-24 9 October 2024 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · retenciones

Retention rate for workers under art. 7p) LIRPF calculated on taxable and non-exempt earnings

A Spanish company relocating employees abroad and benefiting from art. 7p) LIRPF exemption asks how to calculate withholdings. The DGT states that the general procedure under arts. 82 and following of the RIRPF applies, based on the worker's taxable and non-exempt earnings for the year, with possible adjustment under art. 87 RIRPF if circumstances change.

The question raised

Calculation of withholdings on employment income paid to said workers, given that they are entitled to apply the exemption provided for in article 7 p) of the Personal Income Tax Law.

The DGT's ruling

Exempt income is not included in the withholding base pursuant to art. 75.3.a) RIRPF. To calculate the rate, the base is the total amount of predictable taxable and non-exempt remuneration during the year. When taxable remuneration or the exempt amount varies, the rate must be regularized pursuant to art. 87 RIRPF. The resulting withholding is applied to the taxable and non-exempt remuneration.

Book your free first meeting