Liquidation treatment of exempt income progressively in the General Tax Base

The liquidation treatment of exempt income with progressivity that, according to its nature, forms part of the general tax base is structured in the following phases:

The amount of exempt income with progression must be added to the general taxable base and the general tax scale and the one approved by the corresponding Autonomous Community, in the autonomous part, will be applied to the amount resulting from said sum. The result is partial quotas 1 and 2.
The general tax scale is successively applied to the amount of the personal and family minimum (provided that it does not exceed the general taxable base or, where applicable, the general taxable base increased with exempt income with progression), thus obtaining partial quota 3 and the autonomous or complementary tax scale, obtaining partial quota 4.
The following figures are calculated from the four partial quotas obtained in the previous phases:
- Resulting share 1 = partial share 1 - partial share 3
- Resulting share 2 = partial share 2 - partial share 4
Based on the resulting quotas 1 and 2 calculated in the previous phase, the average tax rate, both state and regional, is determined. In both cases, the average rate is the result of multiplying by 100 the quotient resulting from dividing the resulting rates 1 and 2 by the base for the application of the tax scale (sum obtained in phase 1).
Once these average rates have been obtained, they will be applied exclusively to the general taxable base, without including progressively exempt income. In this way, the full state and regional quota, respectively, corresponding to the general taxable base, will be obtained.

Example

Mrs. PCA, resident in the Community of Castilla y León, obtained a general taxable base of 23,900 euros and a savings taxable base of 2,800 euros in the 2023 financial year.

The amount of your personal and family minimum amounts to 5,550 euros. In addition, he has received an income of 2,900 euros in Germany which, pursuant to the Agreement between the Kingdom of Spain and the Federal Republic of Germany to avoid double taxation and prevent tax evasion with respect to income and wealth taxes and its protocol of 3 February 2011, is declared progressively exempt in Spain.

Determine the amount of the full contributions corresponding to said taxpayer.

Solution:

1. Sum of the general taxable base and the amount of exempt income with progression

23,900 + 2,900 = 26,800

2. Application of the IRPF scales to the result of the previous sum (26,800)

General scale of IRPF

Up to 20,200 = 2,112.75

Other: 6,600 at 15% = 990

Odds 1 (2,112.75 + 990) = 3,102.75
Regional scale of IRPF

Up to 20,200 = 2,050.50

Other: 6,600 at 14% = 924

Odds 2 (2,050.50 + 924) = 2,974.50

3. Application of the tax scales to the amount of the personal and family minimum

General scale of IRPF

5,550 at 9.50% = 527.25

Odds 3 = 527.25

Regional scale of IRPF

Note: Although the Community of Castilla y León has approved autonomous amounts of the personal and family minimum, these coincide with the amounts of the taxpayer's minimum, for descendants and ascendants and for disability established in articles 57, 58, 59 and 60 of the Law of IRPF .

5,550 at 9% = 499.50

Odds 4 = 499.50

4. Determination of quota differences:

Resulting quota 1 (quote 1 - quota 3): 3,102.75 - 527.25 = 2,575.50

Resulting quota 2 (quote 2 - quota 4): 2,974.50 - 499.50 = 2,475

5. Determination of average tax rates

Average State Tax Rate (ASR): TME = (2,575.50 ÷26,800) x 100 = 9.61%
Average regional tax rate (TMA): TMA = (2,475 ÷ 26,800) x 100 = 9.23%

6. Determination of the quotas corresponding to the general taxable base (23,900):

State fee: (23,900 x 9.61%) = 2,296.79

Regional quota: (23,900 x 9.23%) = 2,205.97

7. Lien on the liquidated base of savings (2,800)

State lien

2,800 x 9.5% = 266

Autonomous tax

2,800 x 9.5% = 266

8. Determination of full quotas

Total state quota (2,296.79 + 266) = 2,562.79

Total regional quota (2,205.97 + 266) = 2,471.97