Table: collective dismissals: exempt compensation, reduction for irregularity of 30% of the non-exempt amount and early redemption

Note: The table refers to the termination of the employment relationship due to collective dismissal carried out in accordance with the provisions of article 51 of the Workers' Statute (known as the Termination of Employment Regulation File -ERE-), whose consultation period began after August 1, 2008.

Exempt compensation - Art. 7.e) Law Income Tax -	Reduction for irregularity of 30% of the non-exempt amount - Art. 18.2 Law Income Tax -	Early redemption in the form of capital of unemployment pension plans and application of the 40% reduction of the DT 12 Law Income Tax
The minor of: a) 180.00 euros b) The amount corresponding to the contract of the worker affected by the collective dismissal: For contracts after 12-02-2012: 33 days per year of service, with a maximum of 24 monthly payments. For contracts prior to 12-02-2012 (DT 22 Law IRPF : 45 days per year of service from the start date of the contract until February 12, 2012 and 33 days per year of service for the period between February 12, 2012 and the date of dismissal. The amount may not exceed days' salary , unless the calculation of the compensation for the period prior to February 12, 2012 results in a higher number of days, in which case this will be applied as the maximum compensation amount, without said amount being able to exceed 42 monthly payments.	For this purpose, the generation period will be considered as the number of years of service of the worker. These returns can be collected : all at once or in a fractional manner (when the number of years of generation ÷ the number of fractionation periods is > 2) All years in which the compensation is received must be taken into account, including those in which the compensation is exempt. The reduction can be applied even if this reduction had been applied in the last 5 previous financial years. Reduction limit : The limit on which the reduction is to be applied depends on the amount of non-exempt compensation obtained: Up to 700,000 euros: 300,000 euros. Between 700,000.01 and 1,000,000 euros : 300,000 - (Total non-exempt compensation - 700,000). More than 1,000,000 euros: 0 euros.	Reduction : 40 percent If the benefit is received in the form of a capital for the entire amount of the plan, you may apply to the part of the benefit that corresponds to contributions made up to 31-12-2006. If the benefit is received in a mixed form , combining income of any type with a payment in the form of capital, the aforementioned reduction may be applied to the part of the benefit that is received in the form of capital, under the terms set forth for the benefit in the form of capital. Time limits: may be applied to all amounts received in the form of capital (single payment ) in the year in which the corresponding contingency occurs and in the following two years. TEAC Resolution on unification of criteria (No. 00/08719/2021/00/00). If you have several plans, each one can therefore be redeemed in the form of capital in a different financial year within the aforementioned period. Contingencies to be taken into account for early redemption in case of unemployment : 1. Case of collective dismissal as a contingency comparable to retirement. If the specifications of the pension plan provide for the early payment of the benefit corresponding to retirement in the event of collective dismissal ^(), when the collective dismissal occurs and the worker becomes legally unemployed,* at that time (becomes unemployed) the retirement contingency is considered to have occurred regardless of the worker's age, for the purposes of early redemption and the calculation of the time periods for applying the reduction. 2. Assumption of long-term unemployment (contingency not directly linked to the existence of a collective dismissal) When, assumption 1 above does not occur , this contingency is expressly contemplated in the collective pension plan, early withdrawal is permitted and the calculation of the periods for applying the reduction begins. Therefore, if the above assumption (1) is met, early redemption is not appropriate in this case. The following requirements are required: be legally unemployed, have exhausted unemployment benefits at their contributory level or are not entitled to them and be registered as a job seeker.

Exempt compensation - Art. 7.e) Law Income Tax -

Reduction for irregularity of 30% of the non-exempt amount - Art. 18.2 Law Income Tax -

Early redemption in the form of capital of unemployment pension plans and application of the 40% reduction of the DT 12 Law Income Tax

The minor of:

a) 180.00 euros

b) The amount corresponding to the contract of the worker affected by the collective dismissal:

For contracts after 12-02-2012: 33 days per year of service, with a maximum of 24 monthly payments.
For contracts prior to 12-02-2012 (DT 22 Law IRPF : 45 days per year of service from the start date of the contract until February 12, 2012 and 33 days per year of service for the period between February 12, 2012 and the date of dismissal.

The amount may not exceed days' salary , unless the calculation of the compensation for the period prior to February 12, 2012 results in a higher number of days, in which case this will be applied as the maximum compensation amount, without said amount being able to exceed 42 monthly payments.

For this purpose, the generation period will be considered as the number of years of service of the worker.

These returns can be collected :

all at once or
in a fractional manner (when the number of years of generation ÷ the number of fractionation periods is > 2)

All years in which the compensation is received must be taken into account, including those in which the compensation is exempt.

The reduction can be applied even if this reduction had been applied in the last 5 previous financial years.

Reduction limit :

The limit on which the reduction is to be applied depends on the amount of non-exempt compensation obtained:

Up to 700,000 euros: 300,000 euros.
Between 700,000.01 and 1,000,000 euros : 300,000 - (Total non-exempt compensation - 700,000).
More than 1,000,000 euros: 0 euros.

Reduction : 40 percent

If the benefit is received in the form of a capital for the entire amount of the plan, you may apply to the part of the benefit that corresponds to contributions made up to 31-12-2006.
If the benefit is received in a mixed form , combining income of any type with a payment in the form of capital, the aforementioned reduction may be applied to the part of the benefit that is received in the form of capital, under the terms set forth for the benefit in the form of capital.

Time limits: may be applied to all amounts received in the form of capital (single payment ) in the year in which the corresponding contingency occurs and in the following two years. TEAC Resolution on unification of criteria (No. 00/08719/2021/00/00).

If you have several plans, each one can therefore be redeemed in the form of capital in a different financial year within the aforementioned period.

Contingencies to be taken into account for early redemption in case of unemployment :

1. Case of collective dismissal as a contingency comparable to retirement.

If the specifications of the pension plan provide for the early payment of the benefit corresponding to retirement in the event of collective dismissal ^(*), when the collective dismissal occurs and the worker becomes legally unemployed, at that time (becomes unemployed) the retirement contingency is considered to have occurred regardless of the worker's age, for the purposes of early redemption and the calculation of the time periods for applying the reduction.

2. Assumption of long-term unemployment (contingency not directly linked to the existence of a collective dismissal)

When, assumption 1 above does not occur , this contingency is expressly contemplated in the collective pension plan, early withdrawal is permitted and the calculation of the periods for applying the reduction begins. Therefore, if the above assumption (1) is met, early redemption is not appropriate in this case.

The following requirements are required: be legally unemployed, have exhausted unemployment benefits at their contributory level or are not entitled to them and be registered as a job seeker.

^(*)Please note that the specifications of the pension plan may provide for the early payment of the retirement benefit also when the worker becomes legally unemployed in the cases contemplated in articles 49.1.g) [due to the death, retirement or incapacity of the employer], 52 [for objective reasons] and 57 [bankruptcy proceedings] of the Workers' Statute (ET) .^(Back)