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V3260-23 19 December 2023 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · renta vitalicia

Exemption for tax-free income cannot be applied to the supplementary retirement pension for Civil Service Pensioners

A retired military officer enquired whether the supplementary component of their retirement pension (which reaches 200% of the regulatory amount) could be classified as tax-exempt life annuity income. The Directorate-General for Tax (DGT) has ruled that this pension does not meet the requirements for such an exemption.

The question raised

"Possibility of considering the retirement benefit supplement, up to reaching 200%, as a life annuity and, therefore, the possibility of applying the exemption provided for in Article 7-d) of the Personal Income Tax Law, solely to the supplement."

The DGT's ruling

The extraordinary retirement or withdrawal pension does not correspond to the exemptions set forth in Article 7.d) of the Personal Income Tax Law. It does not constitute compensation for civil liability for damages caused by a third party, nor does it constitute compensation derived from an accident insurance contract. Therefore, the exemption is not applicable.

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