Self-employed individuals under direct estimation may only deduct study expenses linked to their activity

The deductibility of training and study expenses for self-employed professionals is a frequent point of debate before the Tax Administration. Recently, the Dirección General de Tributos (DGT) has specified the requirements necessary for these disbursements to be counted as deductible expenses in Personal Income Tax (IRPF).

What the DGT has resolved

The binding ruling establishes that, for study expenses to be considered deductible expenses under the direct estimation method, they must strictly comply with the following criteria:

• Link to the activity: The studies must be directly related to the economic activity carried out and to the generation of income.
• Justification and recording: They must be duly justified and recorded in the accounting or the corresponding books of the professional.
• Temporal imputation: They must comply with the temporal imputation rules required by current regulations.

The resolution underlines that the assessment of whether or not a real link exists between the study and the economic activity corresponds exclusively to the Tax Administration.

What this means for you

If you are a self-employed professional operating under the direct estimation method, it is not enough for a course or training to be of personal interest to be able to deduct it. The key lies in the ability to demonstrate that such knowledge is necessary for the exercise of your current profession and that its purpose is the generation of income.

The Administration has the power to question the deductibility of any training expense if it considers that the connection with the economic activity is not sufficiently close. This implies that the burden of proof lies with the taxpayer.

What you should do

In the event of a possible inspection, it is fundamental to have solid documentation that supports the need for the training. It is recommended to:

• Maintain impeccable accounting records where these expenses are detailed.
• Keep all documentation that proves the relationship between the study syllabus and the functions performed in the economic activity.
• Evaluate the relevance of each expense before including it in the tax return to avoid tax contingencies.

Each professional situation is unique, so it is necessary to assess the nature of each expense on an individual basis.