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V2324-19 10 September 2019 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · indemnización por despido

30% reduction applicable to redundancy payments even if previously used for irregular income in 2017

A worker inquired whether the 30% reduction under Article 18.2 of the Personal Income Tax Law (LIRPF) could be applied to a redundancy payment, having previously utilised this reduction in 2017 for social benefits compensation. The Directorate General for Taxes (DGT) ruled that this is possible because the previous reduction did not apply to income with a generation period exceeding two years.

The question raised

Application of the 30 percent reduction under Article 18.2 of Law 35/2006 to the compensation.

The DGT's ruling

The 30% reduction is not applicable to income with a generation period exceeding two years if the reduction was applied to other income with such a generation period in the five preceding periods. However, the limitation does not affect income obtained in a notoriously irregular manner over time pursuant to Article 12.1 of the RIRPF. Since the 2017 reduction was applied due to irregularity and not due to a generation period exceeding two years, it does not prevent the application of the reduction to the current compensation.

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