The Treasury warns that in 2021 many of the measures put in place to try to alleviate the Covid-19 pandemic will have repercussions on the Personal Income Tax Return and recommends taking advantage of the final stretch of the year to adjust the tax withholdings made so as not to leave everything to the last minute and get a scare.
The measure that will affect the most people is the ERTE:
Taxpayers who earn less than 22,000 euros gross per year from a single payer are not obliged to file a tax return. However, with this measure, people who have been included in an ERTE, even if the total amount obtained in the year does not exceed 22,000 euros, will have at least two payers, which will mean that, in most cases, they will be obliged to file a tax return (if they have obtained more than 1,500 euros from the second and remaining payers) and the result is likely to be a payable tax. To avoid this, one measure to take could be to increase the withholding from the December salary so as not to have a surprise in June 2021 when everything is “almost forgotten”.
ERTE can also affect women with children under 3 years of age. In general, this group is entitled to a deduction of 100 euros per month for each child under 3 years of age, provided that they are self-employed or employed and are registered in the corresponding social security or mutual insurance scheme. However, if they had been included in an ERTE, they would lose the right, since during the time of the ERTE they no longer carry out an employed activity, so the requirements for the maternity deduction are no longer met. The same would apply to self-employed women who have had to close down their activity.
Another aspect to be taken into account is the use of second homes. Many people have used their second homes because of their confinement or the possibility of teleworking. However, they should continue to impute the corresponding real estate income in their tax return, as the only dwelling that is excluded is the habitual residence, therefore, for the purposes of imputation of real estate income, what is taken into account is its availability and not its use.
On the other hand, in the case of a property lease, if the landlord and tenant have reached an agreement, for example, to defer payment of the rent in future months, the landlord must declare the income of these months according to the agreed months.
All aid received within the framework defined as mitigation of the consequences of the pandemic must be declared, such as: minimum living income, the ‘Plan Renove’ for the purchase of vehicles, subsidies from the State Housing Plan and others from the Autonomous Communities, subsidised loans from the IDAE, subsidies to cinemas, or aid from the Covid-19 Fund distributed by the Autonomous Communities.
Finally, a rebate is applied to all those who have made donations to alleviate the effects of the pandemic both to the Treasury and to NGOs with tax exemption on the 80% of the first 150 euros donated, and a 35% from that figure onwards.
Exim Asesores, Tax, Labour and Accounting Consultancy for the self-employed and SMEs, we put at your disposal a team of specialist advisors in each area, we manage the tax, accounting and labour area in person or remotely, by phone 680 830 406, by skype, by mail or via Facebook messenger.
Ask us for an appointment without obligation at 680 830 406 or in dromo@eximasesores.com
