The Directorate General of Taxes addresses in an binding consultation (V2518-22) issued on December 7, 2022 the personal income tax (IRPF) tax treatment of the adjustment of social security contributions paid by self-employed workers in the previous year, in accordance with the new contribution system established in article 308 of the General Social Security Law (LGSS).
To begin with, the consultation refers to article 308 of the LGSS, which was amended by Royal Decree-Law 13/2022, enacted on July 26. This article establishes that self-employed workers included in this special regime must pay contributions based on the annual income obtained in the exercise of their economic, business or professional activities. They must choose a monthly contribution base that adjusts to their estimated annual net income, within the general table established in the corresponding General State Budget Law. This choice is limited by a minimum contribution base in each bracket and a maximum base in each bracket for each year. However, they have the option of choosing a reduced contribution base if they anticipate that their income will be less than the Minimum Interprofessional Wage (SMI) in annual terms. The bases chosen are provisional until they are adjusted according to the annual income reported by the Tax Administration as of the following fiscal year for each self-employed worker.
The Management Center addresses two scenarios in which the RETA contributions can be considered as deductible expenses: as a deductible expense of the work income and as a deductible expense in the development of economic activities. According to article 19 of the LIRPF, the contributions to the Social Security or to general mandatory mutual insurance companies for civil servants are considered as expenses deductible from the income from work.
On the other hand, according to Article 28 of the LIRPF, the net income from economic activities is determined in accordance with the corporate income tax rules. In this case, the deductibility of expenses is conditioned to their correlation with income and their proper justification and recording.
The Directorate General of Taxes establishes that the contributions paid to the RETA in the previous year, in accordance with the new contribution system, will not be considered incorrect, even if in the subsequent regularization different amounts are obtained according to the actual income. These contributions correspond to the legally required payments, based on the estimated returns in the previous year.
Therefore, it will not be required to file a self-assessment rectification or complementary return for the RETA quotas in the previous year if, in the regularization made in the following year, an additional amount must be paid or a refund must be made for RETA quotas.
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