Tax exemption for maternity and paternity benefits and other tax measures

Automatic summary, not yet reviewed

1. Public maternity or paternity benefits stop being taxed under personal income taxincome tax The personal income tax (IRPF in Spain): what people pay on what they earn from work, business or savings., with effect also for prior years not yet time-barred, so taxpayers can request a refund of what they paid. The exemption extends to public employees and to self-employed professionals covered by mutual societies, up to a maximum limit.
2. The thresholds that allow using the simplified method of personal income tax and the simplified and special agriculture, livestock and fishing regimes under VAT are extended for 2019. A new deadline is also set to waive those methods and regimes.
3. Under corporate income tax, credit institutions will include the accounting adjustments from the first application of Banco de España Circular 4/2017 in their tax base in equal parts over the first three tax periods starting from January 1, 2018. In addition, fair value changes will have no tax effect until they are recorded in profit or reserves.
4. The wealth tax remains in force for 2019, and its regulation is amended with effect from 2020: the general 100 percent rebate on the tax liability applies from that year and several articles are repealed.
5. The coefficients for updating the cadastral values of urban properties are approved for 2019, affecting 1,179 municipalities that requested them. Several deadlines for municipalities, such as approving new property tax rates or requesting the coefficients, are extended to July 31, 2019.
6. A special tax regime is created for the 2019 Champions League final and UEFA Euro 2020, with exemptions under corporate income tax and non-resident income tax, customs advantages and VAT refund facilities. The list of priority sponsorship activities for 2019 is also set, and fund units may be reclassified without tax cost for the investor.

Who it affects

• People who received maternity or paternity benefits: They will no longer pay tax on them and can request a refund for prior years not yet time-barred.
• Self-employed people and professionals with business activities: They can keep using the simplified tax methods for personal income tax and VAT in 2019.
• Credit institutions: They get a transitional regime to spread the accounting adjustments from the new Banco de España rules over their tax base.
• Wealth tax payers: The tax still applies in 2019, though with a general 100 percent rebate from 2020.
• Municipalities and urban property owners: Cadastral values are updated in 1,179 municipalities and deadlines for approving property tax rates are extended.

Words worth knowing

IRPF

Spanish personal income tax: the tax individuals pay on their income, such as wages.

Estimación objetiva

A simplified way of calculating income and expenses under personal income tax for certain activities, using fixed modules instead of actual expenses.

Valor catastral

The value the administration assigns to a property for tax purposes, used as the base for the local property tax.

Base imponible

The amount on which a tax is calculated, before applying the tax rate.

Mecenazgo

Private, usually financial, support for activities of general interest, which gives the right to tax deductions.

income tax

The personal income tax (IRPF in Spain): what people pay on what they earn from work, business or savings.

It summarizes the law as published in the BOE. It is written by artificial intelligence and may contain mistakes: the official text is what counts. Read the official text · How we make summaries