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V2986-21 24 November 2021 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · rendimientos del trabajo

Income tax returns required if pension scheme withdrawals exceed employment income thresholds

A query was raised regarding whether there is an obligation to file an income tax return when withdrawing from a pension scheme. The Directorate General for Taxes (DGT) responded that, as these benefits are classified as employment income, the obligation depends on whether the established limits in Article 96 of the Personal Income Tax Law are exceeded.

The question raised

Obligation to file the 2021 Personal Income Tax (IRPF) return when a pension plan is redeemed.

The DGT's ruling

Pension plan benefits are considered earned income. Therefore, the obligation to file a tax return will be determined by exceeding the limits of 22,000 or 14,000 euros, depending on the circumstances set forth in Article 96 of Law 35/2006. The limit of 14,000 euros shall apply when the circumstances described in paragraph 3 of said article occur, subject to the exceptions in letter a).

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