Imputation of December payroll in Personal Income Tax (IRPF): the enforceability criterion

Determining the tax period in which employment income must be declared is a critical aspect for the correct settlement of Personal Income Tax (IRPF). A recent binding ruling from the Directorate General of Taxes (DGT) has clarified the temporal criterion that must be applied to the December payroll, linking it directly to the concept of the enforceability of the payment.

What the DGT has ruled

The DGT has established that employment income is imputed to the tax period in which it is enforceable by its recipient. In this sense, enforceability does not depend exclusively on the moment the deposit is made into the bank account, but on the day the worker has the right to claim said payment according to customs, practices, or established agreements.

Under this criterion, if the enforceability of the monthly payroll coincides with the moment of payment, and this payment is made after December 31, the December payroll of one fiscal year will be imputable to the tax period of the following year. The key lies in determining when the worker's right to demand the economic consideration arises according to the applicable labor regulations.

What this means for you

For the worker, this means that the date on which they receive the money in their account is not the only factor in determining which tax return must include that income. If, by agreement or custom, the December payroll is enforceable in the first days of January, that income must be taxed in the new fiscal year, even if the work was performed in the previous year.

This nuance is relevant for planning the annual tax burden, as the timing of enforceability can shift the tax base from one year to another, affecting the tax settlement.

What you should do

It is necessary to verify the terms of payment enforceability in the employment contract or through the applicable collective agreements. Knowing whether the payment is enforceable at the close of the fiscal year or in the first days of the next allows for a correct understanding of the composition of the income declared in the IRPF. Since each contractual situation is different, it is fundamental to assess the regulations applicable to each particular case.