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V3117-19 7 November 2019 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · seguro de caución

Compensation for interest in a surety bond is taxed as capital gains in the savings tax base

A query was made regarding the Personal Income Tax (IRPF) treatment of compensation received from an insurer due to a developer's failure to pay. The Directorate General for Taxes (DGT) ruled that the return of the principal does not generate a gain or loss, but the interest component is subject to tax.

The question raised

Taxation in the Personal Income Tax (IRPF) of the collection of the insured amounts.

The DGT's ruling

The refund of the amounts paid does not constitute a capital gain or loss as there is no change in net worth. The interest received, having an indemnification nature due to breach of contract, is classified as a capital gain. This interest must be included in the savings tax base pursuant to Article 49.1.b) of the Personal Income Tax Law.

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