Doctrine by topic · DGT Observatory

Gross Employment Income: 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

Stable position High confidence 11 rulings · 2014–2024

Current position

Gross employment income is determined without applying withholdings, deductible expenses, or deductions for debts with Social Security. In the case of payments for special agreements, the amount provided by the company is gross income, but the employee may deduct said cost as an expense. For the application of the 40% reduction, a generation period exceeding two years is required for both the employee's seniority and the validity of the right.

The DGT's position remains stable regarding the definition of gross income, applying consistent criteria on the necessity of not reducing amounts for deductible concepts or withholdings. A constant application of the regulations is observed to distinguish between the nature of the income and the possibility of applying deductible expenses or specific reductions.

Turning points

  1. V3171-15

    Establishes that amounts by mutual agreement do not have a generation period, but allow for the 40% reduction if they are classified as notoriously irregular.

  2. V0916-18

    Defines that amounts to cover contributions for special agreements are gross income, while simultaneously allowing the deduction of the expense pursuant to article 19.2 a) of the LIRPF (Personal Income Tax Law).

Analysis based on 11 of 11 rulings with a stated position. Updated 28 September 2026.

Rulings on this topic

11
V0238-24 29 Feb 2024

Pension contribution reduction limits determined on an individual employer basis

SG de Tributación de las Operaciones Financieras
rendimientos íntegros del trabajobase imponiblesistemas de previsión socialplanes de pensiones de empleoplanes de pensiones simplificados LIRPF — Ley 35/2006 del IRPF art. 17LIRPF — Ley 35/2006 del IRPF art. 51.6
Affects CompanyExpat · Non-residentIndividual
V0582-23 10 Mar 2023

Grants for university staff retraining may be tax-exempt if awarded for research purposes

SG de Impuestos sobre la Renta de las Personas Físicas
becas para investigaciónexención de rendimientos del trabajopersonal docente e investigadorrecualificación del profesoradorendimientos íntegros del trabajo LIRPF — Ley 35/2006 del IRPF art. 7.jLIRPF — Ley 35/2006 del IRPF art. 17.1
Affects CompanyExpat · Non-residentIndividual
V1310-14 14 May 2014

40% reduction on social welfare capital applicable if two conditions are met

SG de Tributación de las Operaciones Financieras
rendimientos íntegros del trabajoreducción del 40%periodo de generaciónprevisión socialjubilación LIRPF — Ley 35/2006 del IRPF art. 17.1LIRPF — Ley 35/2006 del IRPF art. 18.2
Affects CompanyExpat · Non-residentIndividual

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