Deductibility of expenses in sporadic professional activities

The sporadic nature of an economic activity does not exempt the taxpayer from complying with the strict requirements for the deductibility of expenses in Personal Income Tax (IRPF). The Dirección General de Tributos (DGT) has clarified the parameters that must be met for these disbursements to be accepted by the Administration.

What the DGT has ruled

The inquiry addresses the possibility of deducting expenses when a professional activity ceases to be habitual and becomes sporadic. The DGT's criteria establish that, for an expense to be deductible, it must be proven that it was incurred in the exercise of the activity and that there is a direct relationship with the generation of income.

For this deductibility to be valid, the following requirements must be met:

• Correlation with income: The expense must be linked to the generation of income.
• Justification: Expenses must be properly justified through supporting documentation.
• Recording: They must be recorded in the accounting or the corresponding books.
• Temporal imputation: They must comply with the rules of imputation in the correct tax period.

The authority emphasizes that the existence of this correlation is a matter of fact that the management and inspection bodies must assess in each specific case.

What it means for you

This criterion directly affects professionals who, for example, decide to maintain an economic activity on an occasional basis after retiring. If you perform professional activities sporadically, you cannot automatically deduct any expense. The Administration will require evidence demonstrating that the specific expense was necessary to produce the declared income.

What you should do

In the case of an occasional activity, it is fundamental to maintain rigorous control over documentation. It is necessary to ensure that every expense has a clear justification and that its link to the professional activity is evident. It is recommended to assess the particular situation of each expense and the available documentation to ensure compliance with current regulations regarding IRPF and the General Tax Law (Ley General Tributaria).