Business subrogations: they do not imply the existence of multiple payers

The determination of the obligation to file an income tax return depends, to a large extent, on the number of payers a worker has had during the tax year. A recurring question arises when an employee changes companies due to a business subrogation process.

What the DGT has resolved

The Dirección General de Tributos (DGT) has addressed the question of whether the multiplicity of employers derived from business subrogations should be considered the existence of multiple payers for IRPF purposes. The criteria establish that, when changes of company occur through subrogation, the transferee company maintains the status of being the same payer to determine the applicable withholding.

Consequently, there is no existence of more than one payer for the calculation of the thresholds for the obligation to file. The regulations are based on Law 35/2006 on IRPF, ensuring that the continuity of the employment relationship under new ownership does not alter the nature of the original payer.

What it means for you

For workers who have experienced a change of employer due to a subrogation, this has a direct implication on their tax obligation. If the worker has only had this change due to subrogation, the limit for being obliged to file an income tax return remains at €22,000 per year, instead of being reduced due to having multiple payers.

This scenario prevents the taxpayer from being forced to file an income tax return unexpectedly simply due to a change in business ownership which, in practice, does not involve a break in the payment unity.

What you should do

It is necessary to verify that the change of company has indeed occurred under the assumption of business subrogation. In the event that there are other employers besides the subrogated company, the limits for the obligation to file could change. It is recommended to analyze the contractual situation and the withholding data to ensure that the tax treatment is correct according to the IRPF Law.