Doctrine by topic · DGT Observatory

Redemption in the Form of Capital: 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 19 rulings · 2016–2025

Current position

Pension plan benefits are considered income from employment. The 40% reduction on contributions made until December 31, 2006, can only be applied once to benefits derived from the same contingency. The taxpayer may choose in which tax year to apply said reduction, provided it is done within the period established according to the year in which the contingency occurred.

The DGT's position remains constant regarding the application of the 40% reduction. Recent rulings have specified that the contingency occurs when the requirements for early withdrawal are met and have reiterated that the reduction can only be applied once per contingency, even in partial redemptions.

Turning points

  1. V1967-21

    Clarifies that if the requirements for both contingency and exceptional liquidity concur, the benefit is understood for tax purposes to be received due to the contingency.

Analysis based on 18 of 19 rulings with a stated position. Updated 25 September 2026.

Rulings on this topic

19
V1355-24 7 Jun 2024

40% IRPF reduction applicable if early retirement benefits are received as a lump sum

SG de Tributación de las Operaciones Financieras
contingencia de jubilaciónderechos consolidadosreducción del 40%rendimientos del trabajorescate en forma de capital LIRPF — Ley 35/2006 del IRPF art. 17.2.a.3LIRPF — Ley 35/2006 del IRPF art. Disposición transitoria duodécima
Affects CompanyExpat · Non-residentIndividual
V2187-21 30 Jul 2021

The 40% pension plan retirement reduction can only be applied once

SG de Tributación de las Operaciones Financieras
reducción del 40%plan de pensionescontingencia de jubilaciónrendimientos del trabajorescate en forma de capital LIRPF — Ley 35/2006 del IRPF art. 17.2.a.3LIRPF — Ley 35/2006 del IRPF art. Disposición transitoria duodécima
Affects CompanyExpat · Non-residentIndividual
V3321-19 4 Dec 2019

40% pension plan reduction for retirement depends on when the contingency occurs

SG de Tributación de las Operaciones Financieras
contingencia de jubilaciónrescate en forma de capitalreducción del 40 por 100régimen transitorioprestación de planes de pensiones LIRPF — Ley 35/2006 del IRPF art. 17.2.a.3LIRPF — Ley 35/2006 del IRPF art. Disposición transitoria duodécima
Affects CompanyExpat · Non-residentIndividual

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