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V3029-15 8 October 2015 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · indemnización por despido

Redundancy payments for collective dismissals are exempt up to the lesser of the limits set by the Workers' Statute or 180,000 euros

A female worker inquires about the tax treatment and the withholdings applied to her redundancy payment resulting from a collective dismissal. The DGT clarifies that the exemption is capped at 180,000 euros and that any excess is taxed as employment income.

The question raised

Question raised: Tax treatment of the redundancy payment for the termination of the employment relationship. Withholdings.

The DGT's ruling

In collective dismissals due to economic, technical, organizational, production, or force majeure reasons, the exempt portion is that which does not exceed the mandatory limits of the Workers' Statute and, simultaneously, the limit of 180,000 euros. The excess redundancy payment is considered employment income and may qualify for the 30% reduction if the requirements of the LIRPF are met. Regarding withholdings, the company must apply them to the amount subject to tax after applying the corresponding reductions.

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