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V2466-23 14 September 2023 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · rendimientos de actividades económicas

30% reduction cannot be applied to compensation for termination of professional services contract

A nursing professional enquired whether a compensation payment of €17,387.84 received upon the termination of their professional services contract could benefit from the reduction for irregular income. The Directorate General for Taxes (DGT) has ruled that this reduction is not applicable.

The question raised

Application of the reduction provided for in Article 32.1 of Law 35/2006 to the compensation.

The DGT's ruling

The compensation is not considered income with a generation period exceeding two years because it is not linked to the duration of the contract, but rather to the event of termination. It also does not qualify as income obtained in a notoriously irregular manner, as it does not derive from the cessation of an economic activity, but from the termination of a contract. Therefore, the 30% reduction provided for in Article 32.1 of the Personal Income Tax Law is not applicable.

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