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V2912-14 30 October 2014 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · intereses de demora

Late payment interest on tax refunds is taxed as capital gains

A query was raised regarding how late payment interest received from the Tax Administration should be individualised within a marriage under the community property regime. The Directorate General for Taxes (DGT) ruled that this interest is compensatory in nature and must be taxed as capital gains.

The question raised

Individualization of the income corresponding to late payment interest in the event of marriage under the community property regime.

The DGT's ruling

Late payment interest on tax refunds constitutes compensatory interest which is taxed as capital gains, as it does not constitute income from movable capital. The gain is attributed to the person or persons entitled to its receipt. In the case of joint taxation, the apportionment of the refund and its interest must follow the rules of the family unit.

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