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V2685-23 3 October 2023 · SG de Tributación de las Operaciones Financieras Criterion in force
IRPF · rendimientos del trabajo

Pension plan benefits are taxed exclusively as employment income for the beneficiary

A taxpayer inquired whether the redemption of a pension plan established under the community property regime (gananciales) is considered community or separate property. The Directorate General for Taxes (DGT) ruled that these benefits are taxed solely as employment income for the beneficiary, regardless of the origin of the contributions.

The question raised

1. To determine the community or separate nature of the benefits received from the redemption of the pension plan held by the applicant.

The DGT's ruling

Pension plan benefits are attributed exclusively to the natural persons in whose favor they are recognized, regardless of whether the contributions originated from the community property partnership. These amounts are considered earned income and must be included in the recipient's general taxable base. If received as a lump sum, the 40% reduction may be applied to the portion corresponding to contributions made until December 31, 2006, provided that the terms of the twelfth transitional provision are met.

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