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V3178-20 22 October 2020 · SG de Tributación de las Operaciones Financieras Criterion in force
IRPF · contingencia de jubilación

Pension plan benefits are assessed by the primary contingency and limit the 40% reduction

The inquirer asks whether they can receive part of their pension plan due to long-term unemployment without a reduction, and the remainder due to retirement with the 40% reduction. The DGT rules that if the requirements for early withdrawal due to retirement are met, the contingency is considered to be retirement for tax purposes.

The question raised

Possibility of receiving a portion of the vested rights as a lump sum in the event of long-term unemployment without the application of the 40 percent reduction, and subsequently receiving the remainder of the vested rights as a lump sum, due to the contingency of retirement, with the application of the 40 percent reduction.

The DGT's ruling

If the contingency of retirement and an exceptional case of liquidity occur simultaneously, it is understood for tax purposes that the benefit is received due to the contingency of retirement. The 40% reduction may only be applied to amounts received as a lump sum within the same tax period, for the portion of contributions made up to 2006. The period for applying this transitional regime depends on when the contingency occurs, which in the case of early withdrawal is when the employment relationship is terminated.

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