Deductibility of social security special agreement contributions for internships in Personal Income Tax

The Dirección General de Tributos (DGT) has issued a relevant ruling for workers who have entered into special agreements with the Social Security to include internship periods in their contributory history. The inquiry focused on determining whether these payments are considered deductible expenses and in which tax year they must be declared.

What the DGT has ruled

The body has confirmed that the amounts paid to the General Treasury of the Social Security arising from the signing of a special agreement for internships are considered deductible expenses from gross employment income. This treatment is based on the current regulations of the Personal Income Tax (LIRPF).

Regarding the timing of the deduction, the DGT establishes that the temporal imputation must be made in the tax period in which the contributions become due. This factor depends directly on the payment system selected by the taxpayer:

• Single payment: If this modality is chosen, the entirety of the contributions will be imputed to the year in which the agreement is signed and the payment becomes due.
• Installment payments: Imputation will be carried out according to the due date of each installment as per the established payment schedule.

What this means for you

If you are a worker who has made payments to complete your internship periods with the Social Security, you have the right to reduce the base of your employment income by deducting these contributions. It is essential to correctly identify the chosen payment system, as this will determine the tax year in which you can apply the expense, avoiding errors in your tax return.

What you should do

It is necessary to verify the payment system agreed upon with the General Treasury of the Social Security to ensure that the expense is imputed in the correct tax year. It is recommended to keep the documentation proving the signing of the agreement and the payment receipts to support the deduction in the event of a possible action by the Administration. Each particular situation should be analyzed to determine the exact impact on the tax return.