7.1.4. Full performance reductions

As a general rule, full returns will be calculated in full, unless any of the following reductions are applicable:

Irregular returns: Reduction of 30 per 100
Benefits of certain social security systems: Reduction of 30 per 100
Reductions in the transitional regime: Collective insurance, and certain social security systems

Reduction of 30% (Article 100 of the Act) 18.2

A reduction of 30 per 100 will be applied to incomes that have a generation period of more than two years and for which this reduction has not been applied within the period of the five previous tax periods, as well as those classified as being obtained in a particularly irregular manner. in time when, in both cases, they are allocated in a single tax period.

The total amount of the yield on which the reduction will be applied may not exceed 300,000 euros per year.

Without prejudice to the limit set out in the previous paragraph, in the case of earned income whose amount is between 700,000.01 and 1,000,000 euros and derived from the termination of the employment relationship, whether common or special, or from the commercial relationship referred to in Article 17,2 of the Tax Act, or both, the amount of the yield on which the reduction will be applied may not exceed the resulting amount to reduce the difference between the amount of the yield and 300,000 euros. 700.000

When the amount of such returns is equal to or greater than 1,000,000 euros, the amount of the returns on which the reduction of 30% will be zero.

When earned income over a generation period of more than two years is received in instalments, only this reduction of 30% if the quotient resulting from dividing the number of years of generation, counted from date to date, between the 100 number of tax periods in instalments, greater than two (Article 10,2 of the Act).

The return on work resulting from termination of the relationship with directors over a generation period of more than two years may apply the reduction when the quotient resulting from dividing the number of years of generation, counted from date to date, between the number of tax periods of payment in instalments is over two years, provided that the date of termination of the relationship is prior to 1 August 2014.

Options for buying shares.

In the case of earned income derived from the exercise of purchase options on shares or holdings by workers who have been granted before 1 January 2015 and more than two years have passed since it was granted, if it was not granted annually, the reduction of 30% may be applied, even if within the five tax periods prior to the period in which the next customer would have obtained other returns with a generation period of more than two years than those that had applied the reduction.

Incomes obtained in a particularly irregular manner (Article 11 of the Act)

Earned income is considered to be particularly irregular over time, only the following, when they are attributed in a single tax period:

The amounts paid by the company to employees for the transfer to another work centre that exceed the amounts exempt from tax.
Compensation derived from the public Social Security schemes or Ex-civil Servants, as well as benefits paid by Associations of orphans and similar institutions, in the event of non-disabling injuries.
Benefits paid for non-disabling injuries or permanent disability, in any of their degrees, by companies and by Public Entities.
Benefits for death and burial or burial expenses that exceed the exempt limit, for workers or civil servants, both those of a public nature and those paid by Associations of orphans and similar institutions, companies and by Public Entities.
The amounts paid in compensation or repair of salary supplements, pensions or annuities of an indefinite duration or due to the modification of working conditions.
The amounts paid by the company to workers for the resolution of the employment relationship by mutual agreement. The number of years of service of the worker will be considered as the generation period.
Literary, artistic or scientific prizes that do not enjoy exemption from this tax. For these purposes, economic benefits derived from the assignment of intellectual or industrial property rights or which replace them are not considered prizes.

Benefits of certain social security systems (Article 18,3 of the Act)

The benefits of the social security systems of article 17.2.a) 1 and 2 of the Tax Act, i.e. those received by social Security systems, of Ex-civil Servants General Mutual Societies, Associations of orphans and other similar entities, will be reduced in 30% when they are received in the form of capital, provided that more than two years have passed since the first contribution. 100 However, this period does not need to be met in the case of disability benefits. For the rest, we would have to apply the reductions of the following Transitional Regime:

Transitional regime reductions (D.T. 11 and 12 Act)

Transitional collective insurance scheme:

Benefits derived from contingencies occurring before 1 January 2007:

Beneficiaries may apply the financial and tax regime in force at 31 December 2006.
Benefits derived from contingencies occurring from 1 January 2007 on collective insurance policies taken out before 20 January 2006:

The tax regime in force at 31 December 2006 may be applied. This regime will only apply to the portion of the benefit corresponding to the premiums paid up to 31 December 2006, as well as the ordinary premiums provided for in the original policy paid after this date.

However, collective insurance contracts that implement the externalisation of pension commitments agreed in collective agreements at a above corporate level the name "retirement prizes" or others, which consist of a benefit payable at the time of retirement , signed before 31 December 2006, they will be able to apply the tax regime provided for in section 2 above.

Transitional regime for pension plans, mutual benefit societies and guaranteed benefit plans:

Benefits derived from contingencies occurring before 1 January 2007:

Beneficiaries may apply the financial regime and, where applicable, apply the reduction provided for in article 17 of the Consolidated Text of the Personal Income Tax Act in force at 31 December 2006.
Benefits derived from contingencies occurring from 1 January 2007, by the part corresponding to contributions made up to 31 December 2006:

Beneficiaries may apply the financial regime and, where applicable, apply the reduction provided for in article 17 of the Consolidated Text of the Personal Income Tax Act in force at 31 December 2006.

From 1 January 2015, a transitional period has been established to apply the reduction of 30%, both for group insurance and social security systems:

For contingencies occurring from 1 January 2015, only the reduction to the benefit in the form of capital obtained in the financial year in which the corresponding contingency occurs, or in the following two financial years, will be applied.
For contingencies occurring in the years 2011 to 2014, only the reduction to the provision in the form of capital obtained before the end of the eighth financial year following that in which the corresponding contingency occurred will be applied.
For contingencies occurring in 2010 or previous years, only the reduction to the provision in the form of capital obtained until 31 December 2018 will be applied.

Therefore, if the capital benefit is obtained after the deadlines indicated have been completed, no reduction will be applied.

Benefits in the form of capital (art. 11,5 Rgl.)

These reductions are only applicable to benefits in the form of capital consisting of a single payment receipt.

In the case of mixed benefits, which combine incomes of any kind with a single payment in the form of capital, the aforementioned reductions will only be applicable to the collection made in the form of capital.