# Example. Deduction for maternity and increase for custody expenses in daycare centers or authorized early childhood education centers

Mrs. PCA has been registered in the General Social Security Regime throughout 2021, with the full amounts of contributions and annual fees accrued to the aforementioned Regime amounting to 1,800 euros (150/month).

Mrs. PCA has two children: the oldest, born on January 31, 2019, and the youngest, born on August 13, 2021.

The eldest child has been enrolled during the year in the authorized early childhood education center "ZZ" and the expenses paid for the services provided by this center are the following:

• 300 euros for registration
• 4,250 euros [amount that corresponds to the complete months from January to June, both inclusive, October and November (500 euros/month) and 15 days of July (250 euros)].

In relation to these expenses, a scholarship was requested and obtained for the 2021 financial year from the Autonomous Community for the concept of a daycare voucher that reached 1,000 euros, an amount that was paid directly to the "ZZ" early childhood education center by the Ministry of Education.

Likewise, the company where Doña PCA works has also paid directly to the "ZZ" early childhood education center the amount of 1,500 euros, as exempt compensation in kind for its worker.

The rest of the amount of expenses has been paid 50% by each parent.

Determine the amount of the maternity deduction and the additional increase for daycare expenses corresponding to the 2021 financial year and calculate the result of your declaration, knowing that the differential quota thereof amounts to 1,500 euros and that the taxpayer has not requested advance payment of the maternity deduction.

## Solution:

### 1. Maternity deduction amount

Deduction corresponding to the oldest child:

• Number of months of compliance with the requirements: 12 months

• Deduction amount (12 months x 100 euros) = 1,200

• Deduction limit per child (1,200 euros)

Note: The amount of 1,200 euros per year for the first child prevails as the amount of contributions and fees accrued to Social Security in the 2021 financial year is higher (1,800 euros).

Deduction corresponding to the youngest child:

• Number of months of compliance with the requirements: 5 months

• Deduction amount (5 months x 100 euros) = 500

• Deduction limit per child (500 euros)

Note: The amount of 500 euros per second child prevails, as the amount of contributions and fees accrued in the 2021 financial year to Social Security after the birth is higher (750 euros when 5 months are taken into account).

Total amount (1,200 + 500) = 1,700.00

### 2. Additional increase for custody expenses

Additional increase corresponding to the eldest child:

• Number of months of compliance with the requirements: 8 months

• Amount of the increase (1,000 euros ÷ 12 months x 8 months) = 666.64

Note: In the present case, the additional increase for custody costs for a child under three years of age in authorized daycare centers or early childhood education centers can reach up to 1,000 euros per year and will be calculated proportionally to the number of months in which the required requirements are met simultaneously. in article 81.1 and 2 of the Personal Income Tax Law . The months to be taken into consideration are exclusively those in which the expenses paid are made for a full month. Therefore, in this case only the 8 full months are taken into account, excluding the 15 days of July, so the calculation will be: 1,000 euros.12 months x 8 months = 666.64 euros

• Increase limit: 666.64 euros

The increase of 666.64 euros does not exceed any of the limits indicated below:

a) Amount of contributions and fees accrued to Social Security: 1,800 euros

b) Total amount of the non-subsidized effective expenditure of custody expenses: 2,050 euros

Note: in accordance with article 81 of the Personal Income Tax Law and article 60 of the Personal Income Tax Regulations , the total non-subsidized expenditure corresponding to the total amounts annual payments (for complete or incomplete months) paid to daycare centers or early childhood education centers authorized by the pre-registration and enrollment of said minors, attendance, in general and extended hours, and food, will be reduced by the amounts of said expenses that have been paid by the companies employing the beneficiaries that were considered income from work in kind exempt by application of the provisions of letters b) or d) of section 3 of article 42 of the Personal Income Tax Law .

Therefore, in this case the custody expenses will be: 300 (tuition) + 4,000 (8 full months) + 250 (incomplete month) – 1,000 (subsidized amount) – 1,500 (exempt remuneration in kind) = 2,050 euros

Attention: even if it has been paid by both parents at 50%, both the amount paid by the mother or the father will be considered taxpayer entitled to the aforementioned increase, such as that paid by the other parent .

### 3. Tax return result

Differential quota : 1,500.00

Deduction for maternity

• Deduction amount (1,200.00 + 500.00) = 1,700.00

• Increase for daycare expenses (666.64) = 666.64

Declaration result (1,500 − 1,700 − 666.64): −866.64