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V3360-20 16 November 2020 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · rendimientos del trabajo

30% reduction applicable to income with a generation period exceeding two years

A worker inquired whether a bonus paid in 2019, generated between 2017 and 2019, qualifies for the 30% reduction under Article 18.2 of the Personal Income Tax Act (LIRPF). The Directorate General for Taxes (DGT) ruled that this is possible provided it is attributed to a single period and the reduction has not been applied to similar income within the previous five years.

The question raised

Application to the amount received of the 30 percent reduction provided for in Article 18.2 of the Personal Income Tax Law.

The DGT's ruling

To apply the 30% reduction on income from employment with a generation period exceeding two years, such income must be imputed to a single tax period. It shall not be applicable if the taxpayer applied this reduction to other income with a generation period exceeding two years in the five previous tax periods. The amount to which the reduction is applied may not exceed 300,000 euros per year.

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