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V3305-16 13 July 2016 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · retención

Professionals must notify payers of commencement of activity to apply the 7% reduced withholding rate

A professional starting activity in 2015 asks whether they can apply the 7% reduced withholding rate in 2016 after having applied the 15% rate in 2015. The DGT rules that applying the reduced rate depends on the mandatory notification to the payer.

The question raised

If the inquirer decides to apply the 15 percent withholding rate on 2015 invoices, they could apply the reduced withholding rate of 7 percent in 2016.

The DGT's ruling

The 7% withholding rate for the commencement of activity applies during the period of commencement and the two subsequent periods, provided that no professional activity was carried out in the previous year. To this end, the professional must communicate this circumstance to the payer of the income. The payer shall not apply the reduced rate until such communication is received, even if the professional indicates a lower percentage on their invoice.

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