The Income tax return campaign is already underway and this year the Personal Income Tax (“IRPF” 2022) includes new features that must be taken into account, which we will detail in this article.

Deadlines for submission

The deadlines to submit the Income tax return, corresponding to the fiscal year 2022, began on 11 April 2023 and will finish on 30 June, inclusive. In the case of payment by direct debit, the final deadline will be 27 June 2023.

Taxpayers who wish to split the payment of their tax return may do so in two instalments. The first instalment will be a payment of 60% of the amount due by the deadline for submission, i.e., 30 June; the second instalment will be due by 7 November 2023 for the remaining amount.

Changes in the taxation of pension plans

The Government has introduced new modifications to the general maximum limits of reduction for contributions to Pension Plans and certain social welfare systems in the General State Budget 2022. Specifically, the general limit has been reduced to EUR 1.500, which represents a decrease from the EUR 2.000 in 2021.

On the other hand, for employment plans, which are pension plans offered by companies to their employees, the limit for the company has been raised to EUR 10.000 (EUR 1.500 of the general limit + EUR 8.500 as an additional limit). Moreover, as a new feature of this additional limit, employees are offered the option of matching their contribution to that of the company, provided that the sum of both does not exceed EUR 8.500.

Deductions for works to improve the energy efficiency of dwellings

In the fiscal year 2022, three temporary state deductions have been approved to boost investments in energy efficiency in permanent rented dwellings, those in the process of being rented and residential buildings.

It is important to note that these deductions are state deductions and, therefore, will only reduce the state’s total personal income tax amount. When submitting the tax return, the section “deduction for works to improve the energy efficiency of dwellings” must be completed, which includes the three existing deductions:

• Deduction of 20% for improvement works that reduce heating and cooling demand.
• Deduction of 40% for improvement works that reduce the consumption of non-renewable primary energy.
• Deduction of 60% for energy rehabilitation works of buildings.

In order to apply for these deductions, it is necessary to have the energy efficiency certificate. If you have any doubts about the types of works that give right to the deduction, deadlines, bases and deduction percentages, as well as other important details to take into account, you can contact our tax team through the link in the last paragraph.

Minimum Vital Income

In January 2022, a new regulation was approved that includes a child support supplement aimed at beneficiaries of the Minimum Vital Income who have children in their care. This complement will be exempt from Personal Income Tax in accordance with the provisions of article 7.y) of the Personal Income Tax Act.

Youth Cultural Voucher

This is a grant awarded to young people who turned 18 in 2022 and who met a series of requirements. The Youth Cultural Voucher has a maximum of EUR 400 per beneficiary and is intended for the purchase of cultural products and services offered by entities adhering to the programme. In tax terms, this aid is considered a capital gain for the beneficiaries in the amount actually used.

If you need more information about the tax news for your tax return, do not hesitate to contact us here.

CategoryNews, Tax updates