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Practical Income Manual 2019.

Introduction

Regulations: Art. 25.3 Law Personal Income Tax

Income, in cash or in kind, from capitalization operations and life or disability insurance contracts generate income from personal capital subject to Personal Income Tax , as long as they coincide with the contracting party. and beneficiary in the same person (since otherwise, said income would be taxed by the Inheritance and Donation Tax), with the exception of disability insurance whose beneficiary is the mortgagee , and except when they must be taxed as income from work .

Regulations: Art. 17.2 a) Law Personal Income Tax .

Please note that the benefits derived from the following insurance contracts concluded within the framework of social security are taxed as income from work ##:

  • Insurance contracts concluded with social security mutual societies whose contributions may have been, at least in part, a deductible expense or subject to a reduction in the tax base.
  • Corporate social security plans, as well as collective insurance that implement the pension commitments assumed by companies, in the terms provided for in the first Additional Provision of the consolidated text of the Law on the Regulation of Pension Plans and Funds, approved by Royal Legislative Decree 1/2002, of November 29 ( BOE of December 13).
  • Insured pension plans.
  • Dependency insurance in accordance with the provisions of Law 39/2006, of December 14, on the Promotion of Personal Autonomy and Care for People in a Situation of Dependency ( BOE of 15).

For the purposes of subjecting income from capital from capitalization operations and life or disability insurance contracts to tax, the Personal Income Tax Law establishes distinctions depending on the form of taxation. receipt of benefits (income or capital), the term of operations and coverage of contingencies, such as retirement or disability.

This consideration is given to operations that, based on actuarial technique, consist of obtaining commitments determined in terms of their duration and amount in exchange for previously established single or periodic disbursements. See the Annex to Law 20/2015, of July 14, on the organization, supervision and solvency of insurance and reinsurance entities, ( BOE of July 15), section B). b).2.