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V3043-18 28 November 2018 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · reconocimiento de deuda

The acknowledgment of debt has no implications for Personal Income Tax, but its origin must be substantiated

A taxpayer inquires about the tax consequences of acknowledging a debt to her daughter and the daughter's spouse for property expenses. The DGT indicates that the act of acknowledging the debt does not affect Personal Income Tax, but warns that it is necessary to substantiate the origin of said debt.

The question raised

Question posed: The tax consequences of the acknowledgment of debt are consulted.

The DGT's ruling

The acknowledgment of debt, wherein the debtor admits a personal obligation, has no implications for Personal Income Tax purposes pursuant to Article 6 of the Personal Income Tax Law. It produces no effects for the person acknowledging the debt nor for the creditors. Nevertheless, the origin of the acknowledged debt must be substantiated.

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