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V2369-17 18 September 2017 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · rendimientos del trabajo

30% tax reduction applicable if compensation for removal of supplements is attributed to a single year

A company has enquired whether a lump-sum indemnity for the removal of annual supplements (Christmas bonuses and social benefits) allows for the application of the tax reduction for irregular income. The Directorate General for Taxes (DGT) has ruled that it is applicable, provided it is attributed to a single tax period.

The question raised

Application of the 30 percent reduction of Article 18.2 of Law 35/2006 to compensatory indemnity from its consideration as notoriously irregular income.

The DGT's ruling

Amounts paid as compensation for the modification of working conditions are considered income obtained in a notoriously irregular manner. To apply the 30 percent reduction provided for in Article 18.2 of Law 35/2006, such income must be attributed to a single tax period. In this case, the compensation for the suppression of supplements falls within the regulatory assumption of Article 12.1.e) of the IRPF Regulations.

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