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V2477-14 23 September 2014 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · residencia fiscal

Retention obligation depends on worker's fiscal residency

An entrepreneur asks whether IRPF retention is required for workers sent to Romania. The DGT replies that retention depends on whether workers retain their Spanish fiscal residency or become non-residents.

The question raised

Obligation to apply withholding tax on the salaries paid by the consultant to the seconded workers.

The DGT's ruling

If the worker is a tax resident in Spain, the IRPF withholding system applies, unless they opt to communicate their change of residence to be taxed under the IRNR. If the worker is a tax resident in Romania, they will only be taxed in Spain on income from Spanish sources, and no withholding shall be applied to work effectively performed in Romania. In the event that the exemption for work performed abroad (art. 7.p LIRPF) is applicable, there shall be no obligation to withhold on the exempt portion.

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