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Practical manual for Income Tax 2022.

Due to transfer of habitual residence

Regulations: Art. 12 quater and Second Additional Provision of Law 8/2013, of November 21, of the Autonomous Community of Castilla-La Mancha, on Tax Measures

Amount and limits of the deduction

  • 500 euros for the expenses incurred when moving the habitual residence

    This amount will be applied in the tax period in which the change of residence occurs and in the following one.

    Note:Taxpayers who moved their residence in 2021 to sparsely populated areas of Castilla-La Mancha for work reasons can apply this deduction in 2022, as it is the tax period following the one in which the change of residence occurred, as long as the remaining requirements and conditions required for its application are met, including the taxable base limits (22,946 euros in individual taxation or 31,485 euros in joint taxation) indicated in the section "Requirements for applying the deduction" .

  • Limit : the amount of the deduction may not exceed of the autonomous part of the total quota derived from work income and economic activities of the year in which the deduction is applicable.

    In the event that both spouses generate the right to the deduction, in joint taxation, the maximum limit of the deduction is unique for the declaration as a whole, so its determination will be made taking into consideration the set of income from work and economic activities obtained by both spouses and will be applied to the total amount of the deduction which, in accordance with what we explain in the following point, will be 500 euros for each taxpayer (therefore, 1,000 euros in joint taxation)

  • In the case of joint taxation , the deduction of 500 euros will be applied, in each of the tax periods in which the deduction is applicable, for each of the taxpayers who transfer their residence in the terms previously mentioned, with the limit of the autonomous part of the full quota derived from income from work and economic activities that corresponds to the taxpayers who generate the right to apply the deduction.

Requirements for applying the deduction

  • The transfer of habitual residence must occur for work reasons .

    As long as the transfer is for work reasons, the deduction will be applicable to both employees and entrepreneurs or self-employed professionals.

  • The transfer of habitual residence must be made to a municipality of Castilla-La Mancha included in the sparsely populated areas referred to in article 12 of Law 2/202 1, of May 7, on Economic, Social and Tax Measures against Depopulation and for the Development of the Rural Environment in Castilla-La Mancha,

    According to article 12 of Law 2/2021, those groups of municipalities or population centres made up mainly of small municipalities, with a combined population density of less than 12.5 inhabitants per km2, high rates of ageing and intense population loss, with significant geographical isolation from municipalities with more than 30,000 inhabitants, a high percentage of land used for forestry, and a high significance of agricultural activity, will be classified as sparsely populated areas.

    Taking into account the degree of depopulation, the following categories of sparsely populated areas are established:

    1. Areas of intense depopulation : Those groups of municipalities with a density greater than 8 inhabitants per km2.

    2. Areas of extreme depopulation : Those groups of municipalities with a population density of less than 8 inhabitants per km2.

    Note: For the application of this deduction, the population of the municipalities will be taken as that which, according to their respective municipal register, they had on January 1 of each year.

    For the purposes indicated in the previous paragraph, population variations with respect to the 2021 municipal register that entail a reduction or non-application of the deductions that are applicable in accordance with it will not be taken into consideration. In such cases, these deductions may continue to be applied under the conditions and amounts that are appropriate according to the population of the aforementioned municipal register.

    List of sparsely populated areas

    See Decree 108/2021, of October 19, which determines the rural areas of Castilla-La Mancha , in accordance with the typology established in article 11 of Law 2/2021 of May 7, on Economic, Social and Tax Measures against Depopulation and for the Development of the Rural Environment in Castilla-La Mancha (BOCL 10-25-2021)

  • The taxable base of the tax period in which the deductions referred to in the previous point would have begun to be applied, must be less than:

    • - 22,946 euros in individual taxation or

    • - 31,485 euros in joint taxation.

  • To consolidate the right to the deduction, taxpayer must remain in the new habitual residence during the year in which the move occurs and the following three .

Loss of the right to the deduction made

Failure to comply with any of the above requirements will result in the return of the amounts deducted from the full regional quota for the year in which the failure occurs, with the corresponding late payment interest.

The loss of the right to the deduction is excluded in cases where non-compliance is due to the death of the taxpayer.