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V2716-23 6 October 2023 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · retribución en especie

Tuition discounts for employees and their children constitute non-exempt benefits in kind

A foundation sought clarification on whether a 60% discount on undergraduate tuition fees for employees and their children constituted a benefit in kind and if the education exemption applied. The DGT ruled that it is indeed a benefit in kind and that the exemption does not apply as these are university studies.

The question raised

1.- Whether the 60% discount on tuition fees, provided for in Article 48 of the aforementioned Collective Agreement, should be considered a benefit in kind. In the event that it should be considered a benefit in kind, to determine whether the exemption regulated in Article 42.3.d) of the Personal Income Tax Law would apply to undergraduate studies undertaken by the children of the applicant's employees.

The DGT's ruling

The discount on undergraduate tuition fees constitutes a benefit in kind, as a service is obtained at a price lower than the normal market price. The exemption provided in Article 42.3.d) of the Personal Income Tax Law (LIRPF) is not applicable, as it is limited to preschool, nursery, primary, secondary, baccalaureate, and vocational training education. The valuation of this benefit in kind must be carried out in accordance with the price offered to the public, deducting ordinary or common discounts.

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