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V3189-18 14 December 2018 · SG de Tributación de las Operaciones Financieras Criterion in force
IRPF · rendimientos del trabajo

40% reduction applicable to pension plan lump sum withdrawals made before 2019

The inquirer asks whether the 40% reduction can be applied to contributions made before 2007 when withdrawing their pension plan in 2018. The DGT rules that this is possible provided the withdrawal is taken as a lump sum and is carried out within the deadline established by the transitional regulations.

The question raised

Possibility of applying the 40 percent reduction provided for in the transitional regime. Whether it is possible to redeem in the form of a lump sum the rights corresponding to contributions made until December 31, 2006, and the remainder in the form of a periodic annuity. If the option is taken not to redeem the plan, the possibility for beneficiaries to apply the aforementioned reduction to the benefit received as a lump sum after the death of the consultant.

The DGT's ruling

The 40% reduction is applicable to the portion of the benefit corresponding to contributions made until December 31, 2006, provided that it is received as a lump sum and within the period established by the twelfth transitional provision. If a lump sum payment is combined with annuities, the reduction only applies to the portion received as a lump sum. For contingencies occurring in 2010 or earlier, the period for applying this regime ends on December 31, 2018.

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