Exemptions

Exemptions from Article 7 of the Personal Income Tax Law

Individual savings plans

In order to ensure that the application of the exemption provided for in article 7.v) of the Income Tax Law for the income from Systematic Savings Plans complies with the intended purpose, that is, to address, from a tax perspective, the problems arising from aging and dependency by promoting savings, life insurance contracts entered into after April 2019, which implement individual systematic savings plans and which establish reversal mechanisms, certain benefit periods or counter-insurance formulas in the event of death, are required to comply with a series of requirements.

These requirements are not required or applicable to life insurance contracts entered into prior to April 1, 2019, regardless of whether the annuity is established after that date.

Exemption from capital gains in cases of reinvestment

Exemption for reinvestment in life annuities

As in the case of Systematic Savings Plans and for the same reason, that is, to ensure that the application of the exemption of capital gains for reinvestment in life annuities provided for in article 38.3 of the Personal Income Tax Law complies with the intended purpose of promoting pension savings by taxpayers over 65 years of age, the requirements that must be met by insurance life annuities are specified in the case of contracts entered into after April 1, 2019, in which reversal mechanisms, certain benefit periods or counter-insurance formulas in the event of death are established. Requirements that are the same as for Systematic Savings Plans.

The above does not apply to life insurance contracts entered into prior to April 1, 2019.

Other exempt income

Special tax for certain gambling and lottery winnings.

Prizes with a total value of 20,000 euros or less will be exempt for the 2019 financial year.