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Practical manual for Income Tax 2021.

By birth or adoption of children

Regulations: Articles 4 and 18.1 Text Consolidated legal provisions of the Community of Madrid on taxes transferred by the State, approved by Legislative Decree 1/2010, of October 21.

Deduction amounts and application periods

  • 600 euros for each child born or adopted

  • The deduction applies both in the tax period in which the birth or adoption occurs and in each of the two tax periods that follow.

  • In the case of multiple births or adoptions, the amount corresponding to the first tax period in which the deduction is applied will be increased by 600 euros for each child .

Important: in accordance with the Fifth Final Provision of the Revised Text of the legal provisions of the Community of Madrid on taxes ceded by the State, the deduction for the birth or adoption of children in article 4 of the Revised Text of the Legal Provisions of the Community of Madrid on taxes ceded by the State, in the regulations in force since January 1, 2018, will only be applicable to children born or adopted after said date .

Requirements and other conditions for the application of the deduction

  • Only parents who live with their newborn or adopted children will be entitled to take the deduction.

  • When children born or adopted live with both parents and they pay taxes individually, the amount of the deduction will be prorated equally in the tax return of each of them.

  • Limits on the sum of the general and savings tax bases (sum of boxes [0435] and [0460] of the declaration) in order to apply the deduction. A double limit is required; a general one, which must be met by the taxpayer who intends to apply the deduction, and a specific one that must be met by the family unit of which the taxpayer is a part:

    a. Taxpayer: The sum of the taxpayer's general and savings tax bases may not exceed:

    • 30,000 euros in individual taxation.

    • 36,200 euros in joint taxation.

    b. Family unit: the sum of the general and savings tax bases of all members of the family unit of which the taxpayer may be a part may not exceed 60,000 euros.

    Rules for its application:

    • If it is a conjugal family unit (those regulated in article 82.1.1 of the Income Tax Law), the tax bases of each of the members of the family unit make up the unit must be added, regardless of whether or not they opt for the joint tax regime and whether or not they are required to file a return.

    • Thus, for each spouse, the taxable base will be that corresponding to both of them plus that of the children (minors or legally incapacitated adults subject to extended or rehabilitated parental authority), common or not, who live with the couple.

      In the case of joint taxation, the taxable base of said declaration will be the one taken into account for the purposes of the established limit.

    • If it is a single-parent or non-marital family unit, only the tax bases of the members of the family unit that theoretically correspond to each taxpayer must be added, in accordance with the provisions of article 82.1.2 of the Personal Income Tax Law : the taxpayer himself and his children (minors or legally incapacitated adults subject to extended or rehabilitated parental authority) who live with him. And all of this, also, regardless of whether or not they choose to pay taxes under the joint tax regime and whether or not they are required to file a return. In the case of joint taxation, the taxable base of said declaration will be the one taken into account for the purposes of the established limit.