7.1.1. Full returns

All compensation or benefits, regardless of their name or nature, whether monetary or in kind, that derive, directly or indirectly, from personal work or from an employment or statutory relationship and do not have the character of income from economic activities, shall be considered full income from work.

Employment income is attributed exclusively to persons who have generated the right to receive it; except for the benefits of social security systems referred to in article 17.2.a) of the Personal Income Tax Law, which will be attributed to the persons in whose favour they are recognised.

In particular, the following shall be included as work income:

Salaries and wages.
Unemployment benefits.
Remuneration in the form of representation expenses.
Diets and allowances for travel expenses, except for transportation and normal food and lodging expenses in hospitality establishments, within the limits established by regulations.
Contributions or contributions paid by the promoters of pension plans.
Amounts paid by employers to meet pension obligations, when these are attributed to those persons to whom the benefits are linked.
The following benefits of the social security systems are indicated:
1. Social Security and Passive Classes
  
  Pensions and passive assets received from public Social Security regimes and passive classes and other public benefits for situations of disability, retirement, accident, illness, widowhood, or similar.
2. Mutual funds for civil servants
  
  Benefits received by beneficiaries of compulsory general mutual funds for public officials, orphanages and other similar entities.
3. Pension Plans
  
  The benefits received by the beneficiaries of pension plans and those received from the pension plans regulated in Directive (EU) 2016/2341 of the European Parliament and of the Council, of December 14, 2016, relating to the activities and supervision of employment pension funds.
  
  The amounts received in the cases contemplated in article 8.8 of the consolidated text of the Law on the Regulation of Pension Plans and Funds, approved by Royal Legislative Decree 1/2002, of November 29, will have the same tax treatment as the benefits of pension plans.
  
  The benefits received by the beneficiaries of a Pension Plan will be taxed in their entirety as employment income, regardless of the form of collection (income, capital or mixed).
4. Social Security Mutual Funds.
  
  Benefits received by beneficiaries of insurance contracts entered into with social welfare mutual societies whose contributions may have been, at least in part, deductible expenses for determining the net income from economic activities or subject to reduction in the tax base of the Tax.
  
  In the case of retirement and disability benefits, the amount received in excess of the contributions that could not be reduced or decreased in the tax base will be included in the tax base due to failure to comply with the subjective requirements provided for in the Law.
  - Contributions made before 1-1-99 (DT 2 Law )
    Retirement and disability benefits derived from insurance contracts entered into with Social Security Mutual Societies, the contributions to which, made prior to 1 January 1999, have been subject to at least a partial reduction in the tax base, must be included in the tax base of the Tax as employment income.
    
    Integration will be made to the extent that the amount received exceeds the contributions made to the mutual fund that could not be subject to reduction or decrease in the taxable base of the Tax in accordance with the legislation in force at any given time and, therefore, have been previously taxed.
    
    If the amount of contributions that could not be reduced or decreased in the tax base cannot be proven, 75% of the retirement or disability benefits received will be included.
5. Corporate Social Security Plans and Collective Insurance for Workers
  
  The benefits received by beneficiaries of company pension plans are in all cases considered to be work income.
  
  Retirement and disability benefits received by beneficiaries of collective insurance contracts, other than company social security plans, which implement pension commitments assumed by companies, to the extent that their amount exceeds the contributions imputed for tax purposes and the contributions directly made by the worker.
6. Insured Pension Plans
  
  Benefits received by beneficiaries of Insured Pension Plans.
7. Dependency insurance
  
  Benefits received by beneficiaries of dependency insurance in accordance with the provisions of the Law on the promotion of personal autonomy and care for people in situations of dependency.
Amounts paid, by reason of their position, to Spanish Members of the European Parliament, Members and Senators of the Cortes Generales, members of the autonomous Legislative Assemblies, City Councillors and members of Provincial Councils, Island Councils or other local entities, excluding, in any case, the part thereof that said institutions assign for travel and displacement expenses.
Income derived from giving courses, conferences, colloquia, seminars and similar, provided that they do not involve the self-management of means of production and human resources or one of both, with the aim of participating in the production or distribution of goods or services, in which case they will be classified as income from economic activities.
Income derived from the production of literary, artistic or scientific works, provided that the right to exploit them is transferred and they do not involve the independent management of means of production and human resources or one of both, for the purpose of participating in the production or distribution of goods or services, in which case they will be classified as income from economic activities.
The remuneration of directors and members of the Boards of Directors, of the Boards that act in their place and other members of other representative bodies.
Compensatory pensions received from the spouse and alimony annuities, except those received from parents by virtue of a court decision, which are exempt.
Special rights of economic content that are reserved by the founders or promoters of a company as remuneration for personal services. These rights, when they consist of a percentage of the entity's profits, will be valued at a minimum of 35% of the equivalent value of the share capital that allows the same participation in the profits as that granted to the aforementioned rights.
Scholarships, when not exempt.
Remuneration received by those who collaborate in humanitarian or social assistance activities promoted by non-profit entities.
Remuneration arising from special employment relationships.

However, when the income derived from the special employment relationship of artists in public shows and from the special employment relationship of persons who participate in commercial operations on behalf of one or more entrepreneurs without assuming the risk and venture thereof, involves the management on one's own account of means of production and human resources or one of both, with the aim of participating in the production or distribution of goods or services, they will be classified as income from economic activities.
Contributions made to the assets of persons with disabilities, regulated by Law 41/2003, of November 18, on the asset protection of persons with disabilities.

For the taxpayer, a person with a disability, these contributions will be considered as work income not subject to withholding or payment on account, with the following limits:
- When the contributors are taxpayers of the Personal Income Tax, they will be considered as income from work up to the amount of 10,000 euros per year for each contributor and 24,250 euros per year in total.
  
  Likewise, and regardless of the limits indicated in the previous paragraph, when the contributors are subject to corporate tax, they will be considered as work income provided that they have been a deductible expense in corporate tax with a limit of 10,000 euros per year.
  
  These returns and the benefits received in the form of income by people with disabilities from social security systems (art. 53 of the Law), will be exempt up to a maximum annual joint amount of three times the public indicator of multiple-effect income, (the annual amount of the IPREM for the year 2021 is 7,908.60 euros).
- When contributions are made by taxpayers of Corporate Tax in favor of the protected assets of relatives, spouses or dependents of the contributor's employees, they will only be considered as work income for the owner of the protected assets.
The portion of the contributions that is considered to be work income for the recipient will not be subject to Inheritance and Gift Tax.