Summary table

In general

• That the returns have a generation period greater than 2 years.
• That the returns are imputed in a single tax period.
• That within the period of 5 tax periods prior to the one in which they become due, the taxpayer has not obtained other income with a generation period greater than two years to which the reduction has been applied.

• Amounts paid by the company to employees due to transfer to another workplace, which exceed the amounts provided for in article 9 of the Personal Income Tax Regulations.
• Compensation derived from public Social Security or Civil Service schemes, as well as benefits paid by orphanages and similar institutions, in cases of non-disabling injuries.
• Benefits paid for non-disabling injuries or permanent disability, of any degree, by companies and public entities.
• Death benefits and funeral or burial expenses that exceed the declared exempt limit, of workers or civil servants, both those of a public nature and those paid by orphanages and similar institutions, companies and public entities.
• Amounts paid in compensation or reparation for salary supplements, pensions or annuities of indefinite duration or for the modification of working conditions.
• The amounts paid by the company to the workers for the resolution, by mutual agreement, of the employment relationship.
• Literary, artistic or scientific prizes that do not enjoy exemption from this tax.

For income derived from the termination of an employment relationship, common or special:

• The number of years of service of the worker will be considered as the generation period.
• These returns can also be collected in installments.

  In this case, the 30% reduction will only be applicable when the quotient resulting from dividing the number of years of generation, computed from date to date, by the number of tax periods of fractionation, is greater than two.

• The taxpayer may apply the reduction even if, during the previous 5 tax periods, he or she had obtained other income with a generation period of more than 2 years, to which he or she had applied the reduction provided for in this section.

Transitional scheme

• For income received in installments before January 1, 2015 that does not come from compensation for termination of the employment relationship, common or special, or the commercial relationship.
• For income received in installments arising from the termination prior to August 1, 2014 of the business relationship with directors and members of the Board of Directors, and other members of other representative bodies.
• For income derived from the exercise of stock or participation purchase options granted by employees before January 1, 2015.

A) Joint annual limit:

300,000 euros per year 

This limit applies to the sum of the gross income that has a generation period of more than two years, as well as those that are classified by regulation as having been obtained in a notoriously irregular manner over time.

B) Additional specific limits for certain income with a generation period of more than two years, other than those derived from social security systems, without prejudice to the general limit indicated in letter A):

• For income derived from the termination of an employment relationship, common or special, or from the commercial relationship with administrators and members of the Boards of Directors and other members of other representative bodies:

  The limit to which the reduction will be applied based on the amount of irregular work income obtained will be:

  • Between 700,000.01 and 1,000,000 euros: 300,000 - (RT - 700,000)
  • More than 1,000,000 euros: 0 euros
• For income derived from the exercise of stock or participation purchase options granted by employees before January 1, 2015:

  The amount of the income may not exceed 300,000 euros, or, if lower, the amount resulting from multiplying the average annual salary of all personal income tax filers (22,100 euros) by the number of years of income generation, and this limit may be doubled in the cases reflected in the corresponding section of the limits.