Skip to content
Back to index
V2285-14 5 September 2014 · SG de Tributos Criterion in force
IRPF · ganancia patrimonial

Vehicle theft indemnity not subject to IRPF retention

A businessperson enquired whether retention should apply to receiving a vehicle theft insurance claim. The DGT responds that, depending on the nature of the vehicle and its connection to business activity, the indemnity is treated as either business income or patrimonial gain, neither of which is subject to retention.

The question raised

Obligation to perform withholdings upon receipt of the compensation.

The DGT's ruling

If the vehicle is an inventory item of the activity, the compensation is income from the activity. If it is a business asset or a personal item, it constitutes a capital gain or loss. In both cases, the income is not subject to withholding as it is not listed in Article 75 of the RIRPF. Furthermore, the compensation should not be included in the annual declaration of transactions with third parties as it does not require an invoice.

Book your free first meeting