Skip to content
Back to index
V3462-20 30 November 2020 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · rendimientos del trabajo

Withholding tax on extra payments must be applied at the time of payment

A query was raised regarding whether a company must withhold Income Tax (IRPF) in 2020 for extra payments not received due to an ERTE (temporary layoff scheme). The Directorate General for Taxes (DGT) ruled that the obligation to withhold arises when the income is actually satisfied or paid.

The question raised

Whether the company must effect withholding in 2020 for the extra payments of the year 2020 not collected, and if so, how this must be reflected in the worker's Personal Income Tax (IRPF) return.

The DGT's ruling

The obligation to withhold arises, as a general rule, at the moment when the income is satisfied or paid. Therefore, if the extra payments for the year 2020 have not been paid in said fiscal year, the company must not apply the corresponding withholding in 2020.

Book your free first meeting