Gender gap supplement arrears must be attributed to the years they were due

The tax treatment of retroactive Social Security payments has been defined following a recent resolution by the Directorate General of Taxes (DGT). The body has specified how arrears from the gender gap supplement must be taxed under Personal Income Tax (IRPF).

What the DGT has ruled

The DGT establishes that the gender gap supplement constitutes income from employment. Therefore, its taxation must take place in the tax period in which the right to receive said amount becomes due.

When a taxpayer receives back payments in a year different from the one to which they corresponded due to circumstances beyond their control, the general rule of attribution in the year of collection should not be applied. Instead, the special rule provided for in Article 14.2.b) of the IRPF Law must be applied. This implies that each amount must be attributed to the fiscal year to which its due date originally belongs.

What this means for you

If you are a pensioner and have received a retroactive payment regarding the gender gap supplement, you cannot declare the entire sum in your income tax return for the current year. The regulations require you to break down the amounts and assign them to the years to which they correspond.

This situation entails the need to rectify the income tax returns of previous fiscal years. Since this is a situation not attributable to the taxpayer, these modifications are carried out by filing supplementary tax returns.

What you should do

Upon receiving these amounts, it is necessary to:

• Precisely identify the periods to which the received arrears correspond.
• File supplementary tax returns for the affected fiscal years to comply with current regulations.
• Assess each particular case to ensure that the attribution of income complies with the regulations of the IRPF Law and the General Tax Law.