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V2370-17 18 September 2017 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · rentas en especie

Company-paid nursery expenses may be exempt from Income Tax if agreed as benefits in kind

A query was raised regarding whether company payments for employees' childcare expenses constitute benefits in kind. The DGT clarifies that if such payments are part of an agreed benefits-in-kind package, the nursery expenses are exempt.

The question raised

Application of the provisions of Article 42.3.b) of Law 35/2006.

The DGT's ruling

If the payment for nursery services is a benefit in kind agreed upon in the contract or agreement, the exemption under Article 42.3.b) of the Personal Income Tax Law applies. It is not considered a mediation of payment if the company has the obligation to provide the service. In this case, it is irrelevant whether the service was contracted by the company or the employee.

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