Inclusion of Personal Income Tax (IRPF) withholding in professional invoices

Billing management between self-employed professionals and companies often raises doubts regarding the elements that must appear on the commercial document. Recently, the Dirección General de Tributos (DGT) issued a ruling that clarifies the possibility of including Personal Income Tax (IRPF) withholding in an invoice, despite it not being an indispensable legal requirement for the document's validity.

What the DGT has ruled

The query focused on determining whether it was correct to record the IRPF withholding on an invoice issued by a professional. The DGT concluded that the recording of said withholding is not part of the mandatory requirements that an invoice must meet under current regulations. However, the body points out that there is no impediment whatsoever for a professional to decide to include it in the document.

The ruling emphasizes that the legal obligation to perform the withholding lies with the person or entity that pays the income. It is this payer who must effect the withholding and, subsequently, issue the certificate accrediting the withholdings made to the professional.

What this means for you

This pronouncement has direct implications for two profiles:

• Self-employed professionals: They have the freedom to include the breakdown of the withholding in their invoices to facilitate accounting management and the clarity of the net amount to be collected, even though the law does not oblige them to do so.
• Companies: When hiring the services of professionals, they maintain the responsibility to apply the corresponding withholding at the time of payment. The fact that the withholding appears detailed on the received invoice does not alter their obligation to perform it and to issue the corresponding certificate.

What should be done

Since the inclusion of the withholding is an option and not a requirement, it is important for both professionals and companies to coordinate their billing processes. It is recommended to verify that the applied withholding matches the rates established in the IRPF Law and the IRPF Regulations. Each billing situation must be analyzed to ensure that the document correctly reflects the economic operation and complies with the payer's withholding obligations.