Doctrine by topic · DGT Observatory

Judicial Finality: DGT doctrinal evolution

How the DGT's position on this topic has evolved, and the rulings it rests on.

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How the DGT's position has evolved

Settled doctrine High confidence 47 rulings · 2014–2026

Current position

Income from employment derived from judicial rulings is imputed to the tax period in which the judgment becomes final. The excess of the compensation for unfair dismissal over the legal limits is taxed as employment income. To apply the 30% reduction for irregular income, the generation period must exceed two years and the reduction must not have been applied in the previous five periods, respecting the limit of 300,000 euros.

The DGT maintains consistency in the temporal imputation of arrears to the moment of judicial finality. The evolution focuses on precision regarding the application of the reduction under Article 18.2 of the LIRPF (Personal Income Tax Law), moving from an initial refusal due to lack of requirements to the confirmation of its applicability when the generation period and periodicity limits are met.

Turning points

  1. V1171-17

    Establishes that compensation for unused rest days is employment income and confirms the application of the 30% reduction if the generation period exceeds two years.

  2. V1540-19

    Specifies that receipt at a time different from when it was due due to causes not attributable to the taxpayer allows for a supplementary self-assessment without penalties or interest.

Analysis based on 42 of 47 rulings with a stated position. Updated 23 September 2026.

Rulings on this topic

24
V1762-24 17 Jul 2024

Compensation for excessive truck purchase costs taxed as business income

SG de Impuestos sobre la Renta de las Personas Físicas
rendimientos de actividades económicasimputación temporaldevengoindemnizaciónreducción por irregularidad LIRPF — Ley 35/2006 del IRPF art. 14.1.bLIRPF — Ley 35/2006 del IRPF art. 32.1
Affects CompanyExpat · Non-residentIndividual
V0951-23 20 Apr 2023

30% reduction applicable to income generated over a period exceeding two years

SG de Impuestos sobre la Renta de las Personas Físicas
reducción del 30%período de generaciónrendimientos del trabajoimputación temporalretribuciones dejadas de percibir LIRPF — Ley 35/2006 del IRPF art. 14.2LIRPF — Ley 35/2006 del IRPF art. 17.2.a
Affects CompanyExpat · Non-residentIndividual
V3258-20 30 Oct 2020

A 15% withholding tax must apply to back pay paid in 2020 for 2019 arrears

SG de Impuestos sobre la Renta de las Personas Físicas
salarios de tramitaciónrendimientos del trabajoatrasosimputación temporalretenciones LIRPF — Ley 35/2006 del IRPF art. 14.1 a)LIRPF — Ley 35/2006 del IRPF art. 14.1.2 a)
Affects CompanyExpat · Non-residentIndividual
V3041-19 29 Oct 2019

30% reduction applicable to income with a generation period exceeding two years

SG de Impuestos sobre la Renta de las Personas Físicas
imputación temporalrendimientos del trabajodaños patrimonialesperíodo de generaciónreducción por irregularidad LIRPF — Ley 35/2006 del IRPF art. 14LIRPF — Ley 35/2006 del IRPF art. 17.1
Affects CompanyExpat · Non-residentIndividual

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