We next review the income that is exempt from taxation in the Personal Income Tax.
Compensation for civil liability
Compensation for having suffered any personal injury, whether moral, physical or mental, is not taxable for the amount legally or judicially recognized for these damages. The part that is not exempt is classified as capital gain.
Labor compensation for dismissal or dismissal of the worker
Compensation that does not exceed the mandatory amount according to the Workers' Statute and its implementing regulations is exempt from taxation up to 180,000 euros. The compensation is also not taxable if the dismissal has occurred due to economic, technical, organizational, production or force majeure causes and does not exceed the mandatory amount according to the Statute or does not exceed the aforementioned 180,000 euros.
The aforementioned limit does not apply to compensation for dismissals or collective terminations before August 2014 or to dismissals after that date when they arise from an employment regulation file whose consultation period had begun previously.
Compensation in kind
Some of the compensation for work in kind is not taxed, such as transportation checks, restaurant checks, or medical insurance paid by the company, while other compensation in kind has a certain valuation. The agreement with the employer that part of the remuneration be in kind instead of money must be stated in the employment contract.
When the remuneration is not exempt, the valuation must be calculated applying the special rules regulated for work income, which is the case of the use of housing or vehicles by employees. For income other than work, the market value will be taken into account. In both cases, the corresponding payment on account must be added to the valuation resulting from the above, unless it is passed on to the employee.
Perception of unemployment benefit through the single payment modality
If you became unemployed in 2016, the benefits recognized by the respective managing entity are not taxable when they are received under the single payment modality. This will be the case when the benefits are used to carry out self-employment, or to become a member of associated labor cooperatives or labor societies.
To be entitled to the single payment modality, it is necessary to meet a series of requirements, which are the definitive cessation of the employment relationship, having at least three months of benefits pending receipt, not having obtained the recognition of a single payment in the four years prior to the date of the application, or start the activity within a maximum period of one month from the granting of the right and always with a date after the application.
Transmission of assets for people over 65 years of age
The capital gain obtained in the sale of the primary home for people over 65 years of age is exempt from taxation, and it is not necessary to reinvest the amount obtained in the transfer in any other asset.
The habitual residence is considered to be transferred if it acquired such status, even when the transfer occurs in the two years following when it ceases to be so.
If another asset element other than that of the habitual residence is transferred, the gain obtained will not be taxed if the total amount of the sale is used to create an insured life annuity, with a maximum limit of 240,000 euros and before six months have passed. from the alienation of the property.
Transfer of urban properties during 2016
The positive income obtained from the sale of an urban property acquired for consideration between May 12 and December 31, 2012 may be reduced by 50%.
Long Term Savings Premiums
There are certain financial products that are tax protected, for example, Long-Term Savings Plans (PALP), materialized in life insurance or deposits whose profitability will not be taxed if certain requirements are met.
Individual Systematic Savings Plans (PIAS)
Since 2015, the minimum term has been reduced from 10 to 5 years to redeem the Individual Systematic Savings Plans (PIAS) and, in this way, take advantage of the tax advantage of exempting the accumulated profitability from the first payment of the premium until the produces the first collection of the annuity.
Donation from a family business
The profit generated in the transfer for profit (during life) by the owner of a family business to his descendants or of the shares in a family company will not be taxed as long as the requirements to apply the reduction in the transfer in the company are met. family in the terms regulated in the Inheritance and Donation Tax regulations.
Loan between family members
In the case of an unpaid loan, it is necessary to destroy the possible presumption of onerousness, for example, through a contract made public by filling out and submitting form 600 of the Tax on Property Transfers and Documented Legal Acts, attaching the interest-free contract, and where the principal repayment period is stated.
Vehicle acquisition with PIVE Plan
Access to the PIVE plan is taxed as capital gain in the general tax base. If the vehicle was purchased with marital funds, the aid for said plan will correspond to 50% for each of the spouses.
Condominium extinction
In the extinction of condominiums, whether due to divorce or dissolution of a community, when lots that correspond to the ownership fee are awarded, in principle no tax should be paid on the capital gain derived from said extinction.
On the contrary, if assets or rights of a greater value than the corresponding share of ownership are attributed to one of the community members, there will be a capital alteration in the other community member, and therefore, a capital gain or loss.
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