2.Obligation to report

The holders of the minimum living income regulated in Law 19/2021, of 20 December, which establishes the minimum living income and all the members of the cohabitation unit are obliged to present a declaration of IRPF , in accordance with article 36.1.f and 2.c) of the aforementioned law regardless of whether or not they meet the requirements established in article 96 of the IRPF Law for the obligation to declare.

Taxpayers obliged to declare

In general, the taxpayers are obliged to file and sign a personal income tax return, subject to the limits and conditions established by regulations.

However, taxpayers who obtain income exclusively from the following sources, whether individually or jointly taxed, are not obliged to file a tax return:

1. Full income from work (including, inter alia, pensions and passive assets, as well as compensatory pensions and maintenance payments) not exceeding the following amounts:

   • 22,000 per year if they come from a single payer.

     The same limit also applies when the income from work comes from more than one payer, if the sum of the amounts received from the second and other payers, in order of amount, do not together exceed the sum of 1,500 euros per year.

     The limit shall also be 22,000 euros in the case of taxpayers whose only income from work consists of the passive benefits referred to in Article 17.2.a) and the determination of the applicable withholding rate has been carried out in accordance with the special procedure established in the regulations.For this purpose, the pensioner with two or more payers must have requested the determination of the withholding rate by means of form 146.

   • 14,000 euros per year in the following cases:

     • When they come from more than one payer (except for the exception provided for in the previous point).
     • When compensatory pensions are received from the spouse.
     • Where maintenance annuities are received which are not exempt.
     • When the payer of the earned income is not obliged to withhold tax in accordance with the regulations (see art. 76 Rgl. IRPF).
     • When full income from work is received at the fixed withholding rate of Article 80.1.3º and 4º of the tax regulations.
2. Full income from movable capital (dividends on shares, interest on accounts, deposits or fixed-income securities, etc.)and capital gains (gains derived from redemptions of shares in Investment Funds, prizes for participation in competitions or games, etc.), subject to withholding or payment on account, with a joint limit of 1,600 euros per year.

   When the withholding tax base has not been determined according to the amount to be included in the taxable base, the capital gain obtained from transfers or redemptions of shares or units of collective investment institutions may not be included as a capital gain subject to withholding or payment on account for the purposes of the limits excluding the obligation to file a tax return.

3. Imputed real estate income, , full income from movable capital not subject to withholding derived from Treasury Bills and subsidies for the acquisition of social housing or subsidised housing and other capital gains derived from public aid, with the joint limit of 1,000 euros per year.

   Where the taxpayer has not been the owner of the property generating imputed property income during the whole of the year (because it was acquired or transferred in that year), the amount shall be apportioned according to the number of days in the year during which the taxpayer has been the owner of the property.

Exception to the obligation to declare

In no case will taxpayers who exclusively obtain full income from work, capital (movable and real estate) or economic activities, as well as capital gains, with a joint limit of 1,000 euros per year and capital losses of less than 500 euros, be obliged to file a tax return (except for the purposes of the following section).

Obligation to declare if certain deductions or allowances are made

Taxpayers who are entitled to apply the following deductions or reductions, when they exercise this right, are obliged to file a tax return in any case:

• Contributions to protected estates of people with disabilities, pension plans, insured pension plans or mutual benefit plans, company pension plans and dependency insurance that reduce the taxable base.
• Deduction for investment in housing (transitional regime)
• Deduction for international double taxation.

Attention

In order to determine the obligation to declare it is important to take into account the following:

• Obtaining other types of income:

  Taxpayers who receive any other type of income or who receive income in excess of the amounts or ceilings indicated are obliged to file a tax return.

• Exempt income:

  Income exempted from tax (e.g. social security pensions for absolute permanent incapacity or severe disability, public study grants, maintenance payments received from parents by court decision) will not be taken into account.

• Income subject to the special tax on certain lotteries and bets, regulated in additional provision thirty-three of the Tax Law, will not be taken into account.

Joint taxation

In order to determine the requirement to file a tax return or not, the amount of income, the gross taxable base, net base and tax liability; the rules of individual taxation are generally applied, without raising or multiplying the amounts or limits based on the number of members in the family unit, except in cases expressly established in the rules.

Income of any kind obtained by each and every member of the family unit shall be taxed cumulatively; however, for the purpose of determining the number of payers, account shall be taken of the situation of each of the members of the family unit individually considered.

All members of the family unit are jointly and severally liable for taxation and, hence, the tax liability resulting from the tax return or tax inspection by the Tax Authorities, may be demanded in full from any of the members.

The same scales and taxes are applied as for individual taxation.

Except where expressly required by tax regulations, joint tax returns shall not give rise to the extension of any limits affecting certain deductible items.

Tax loss carryforwards from prior years not offset by the taxpayers in the family unit can be offset in accordance with general tax regulations, regardless of whether they come from a previous individual or joint return.

Negative items determined in joint taxation shall be offset, in the event of subsequent individual taxation, exclusively by those taxpayers to whom they correspond.

The reductions in the taxable base for contributions to social welfare systems, including those constituted for persons with disabilities, to protected estates of persons with disabilities and to the mutual social security society of professional athletes, the maximum limits of reduction will be applied individually for each participant, contributor, members of mutual companies or insured person integrated in the family unit who is entitled to any of these reductions.

In any type of family unit, the minimum personal amount applicable in the joint tax return is 5,550 euros per year, irrespective of the number of members in the family unit.The computation for increase of the minimum personal amount by age of the taxpayer will be carried out in accordance with the personal circumstances of each spouse.

The tax-free threshold when the taxpayer has a disability shall be calculated taking into account the disability circumstances which, if any, are present in each of the spouses in the family unit.