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What taxes are there?

Individualization of personal income tax

This tax is characterized by taking into account citizens' personal and family circumstances to determine their true financial capacity. Another important feature is that it is a progressive tax, since the percentage (tax rate) applied to determine the amount each person must pay varies in a manner that is more than proportional to the variation in the income being taxed (taxable base).

Tax personalization is achieved not only through progressivity, but also through the establishment of exemptions, reductions, and deductions:

  1. Some returns that encompass the concept of income are initially reduced, taking into account certain circumstances that are to be favored; Thus, in the case of income from work, the reduction increases the lower the income is, that is, people who earn less receive a greater reduction (article 20). In addition, there are other reductions that are applied in principle to the general tax base (general income less deductible expenses), regulated in articles 51 to 55. Once the aforementioned reductions have been applied, the taxable base (general and savings income) will have been determined.

  2. Establishment of a personal and family minimum (articles 56 to 61 of the Law) whose main objective is to adapt the tax to the personal and family circumstances of the taxpayer. The minimum personal allowance will be higher for taxpayers over 65, and will increase even further for those over 75. The family minimum will increase depending on the number of children and ancestors (parents and grandparents) living with the taxpayer. Furthermore, the disability of the taxpayer himself or her, or of his or her dependent children and ancestors, will increase the family minimum.

The personal and family minimum is integrated as a zero bracket in the taxable base (in principle the general one), applying the progressive rate of the tax to the entire taxable base (the quota corresponding to the entire taxable base is found by subtracting that corresponding to the personal and family minimum), resulting in a higher percentage the higher the amount; The deductions established in articles 68, 80 and 81 of the Law are subtracted from the result, among which we can highlight the following:

  1. Deduction for maternity: for women who work outside the home with children under three years of age. This deduction can be requested from the Tax Agency in advance, and can be collected monthly.

  2. For large families or those with disabilities in their care. There are various situations that give rise to the receipt of an annual amount of 1,200 euros.

  3. Through donations to certain foundations or through investments and expenditures in assets of cultural interest.