Back to index
V2721-17 24 October 2017 · SG de Tributación de las Operaciones Financieras Criterion in force
IRPF · rendimientos del trabajo

40% reduction applicable to pension plan benefits even after receiving collective insurance payouts

A taxpayer inquired whether the 40% tax reduction could be applied to a pension plan benefit after having already received a collective insurance payout. The Directorate General for Taxes (DGT) ruled that the pension plan reduction remains applicable provided the transitional requirements are met, regardless of any insurance payments received.

The question raised

1. Application of the 40 percent reduction to the benefit received from the pension plan, taking into account that the benefit from the aforementioned insurance would have been collected previously.

The DGT's ruling

The 40% reduction on pension plan benefits received as a lump sum is applicable to the portion corresponding to contributions made until December 31, 2006, provided that the terms of the twelfth transitional provision are met. This possibility is not affected by the receipt of a benefit from a collective insurance policy. However, for the collective insurance contracted in 2012, neither the 40% reduction nor the 30% reduction applies as they are considered employment income pursuant to Article 17.2.a).5th.

Book your free first meeting