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New regulations 2026

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Main tax changes introduced by Royal Decree-Law 23/2026, of September 8 (BOE September 9), which approves fiscal and financial measures that contribute to the economic and social reconstruction of the island of La Palma, as well as measures aimed at promoting the execution of investments by the autonomous communities that have registered budget surpluses and excess financing pending application from years prior to 2026

PERSONAL INCOME TAX

It contains the following new features and modifications that affect Law 35/2006, of November 28, on Personal Income Tax (LIRPF):

Extension of the tax deduction for residence on the island of La Palma

HE expands for the tax period 2026 the application of the Deduction for habitual and effective residence on the island of La Palma (effective from 1 January 2026, the Fifty-seventh Additional Provision of Law 35/2006, of PIT) it being understood, for these purposes, that the references made to Ceuta and Melilla in said article, in article 101 of the LIRPF and in their respective regulatory development, they are to the island of La Palma.

  • Effects on Withholdings and Installment Payments:
    • The deduction for habitual and effective residence on the island of La Palma must be taken into account to determine the type of withholding and payment on account to be applied to the returns to which the aforementioned deduction applies that have been paid from the September 10, 2026 (entry into force of this Royal Decree-Law).
    • The payer (company or entity) may choose to regularize the withholding tax rate or payment on account for the first employment income received as of September 10, 2026 (to whom the general withholding procedure referred to in Article 82 of the Regulation applies) PIT), or regularize from the the following month upon entry into force (October 2026), in which case the payments made before that date will be calculated without taking the deduction into account.
    • The deduction will also be taken into account when calculating the rate of installment payment corresponding to the economic activities carried out on the Island of La Palma that have the right to it whose submission period had not started at the time of the entry into force of Royal Decree-Law 23/2026 (September 10, 2026). In other words, it will apply to the installment payments corresponding to the 3rd and 4th quarters of 2026. 

 

(Article 1 of Royal Decree-Law 23/2026)

Real Decreto-ley 23/2026, de 8 de septiembre,

por el que se adoptan medidas fiscales y financieras urgentes que contribuyan a la reconstrucción económica y social de la isla de La Palma, así como medidas tendentes a promover la ejecución de inversiones por parte de las comunidades autónomas que han registrado superávits presupuestarios y excesos de financiación pendientes de aplicar de ejercicios anteriores a 2026.