Special retirement and disability benefits scheme
Regulations: Articles 25.3 a) 4 Law IRPF (second paragraph) and 19 Regulation IRPF
Retirement and disability benefits received in the form of income by beneficiaries of life or disability insurance contracts in which there has been no type of mobilization of the provisions of the insurance contract during its validity, will be integrated into the tax base as income from movable capital, from the moment in which their amount exceeds the premiums that have been paid under the contract.
In the event that the income has been acquired by donation or any other legal transaction, free of charge and inter vivos, it will be included in the tax base as income from movable capital, from the moment in which its amount exceeds the actuarial present value of the income at the time of its creation.
In both cases, ## the percentages provided for immediate life or temporary annuities will not apply. The application of this regime is also subject to compliance with the following requirements (Art. 19 Regulation IRPF ):
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That the insurance contract has been taken out at least two years prior to the retirement date.
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The contingencies covered must be those provided for in article 8.6 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).
In accordance with the provisions of the aforementioned article, the contingencies covered by the Pension Plans and for which benefits will be paid are the following: retirement; total and permanent incapacity for work in the usual profession, or absolute and permanent incapacity for any work, and severe disability, determined in accordance with the corresponding Social Security Regime; death of the participant or beneficiary, which may give rise to the right to widowhood or orphanhood benefits, or in favour of other heirs or designated persons and severe or great dependency of the participant regulated in Law 39/2006, of December 14, on the promotion of personal autonomy and care for people in situations of dependency (BOE of December 15).
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It will be understood that some type of mobilization of the provisions of the insurance contract has occurred when the limitations established in the First Additional Provision of the consolidated text of the Law on the Regulation of Pension Plans and Funds, and its implementing regulations, regarding collective insurance that implements company pension commitments, are breached.
Note: If the above requirements are met, this special regime is applied with preference to the general regime mentioned above.
Example:
Mr. JPN signed a deferred annuity life insurance contract on May 10, 2014, paying an annual premium of 5,000 euros payable on May 10 of each of the years 2014 to 2022, both inclusive.
On May 13, 2022, coinciding with his 65th birthday and his retirement date, he began receiving a life annuity of 4,500 euros per year.
Determine the net return on movable capital knowing that, according to the certification of the insurance company's actuary, the current actuarial financial value of the life annuity to be collected amounts to 65,000 euros.
Solution:
Applying the special retirement benefits regime, the following results:
Income received (4,500 x 10) = 45,000
Premiums paid (5,000 x 9) = 45,000
Income from movable capital during the first ten years of income collection (45,000 - 45,000) = 0
Income from movable capital from the eleventh year of income collection = 4,500 euros each year.