Positive income result: do I get paid or refunded?

The presentation of the Income statement (IRPF) It is one of the most important moments in the taxpayer’s calendar. Those who know about taxation have no problem calculating if this tax will come out to pay or to returnbut the common mortal waits for the eraser sent by the Treasury to be sure of the result.

In the month of April the term to review the draft opens and there is a deadline until June to review it calmly, modify possible errors and present the declaration. In 2021 the term opened on April 7. In this link you can access all the information available on the Treasury website.

Personal income tax is one of the basic pieces of the Spanish tax system and its purpose is to respond to the principle established by the Spanish Constitution that all Spaniards must contribute to the maintenance of public expenses.

What does personal income tax tax?

The personal income tax is taxed income for the year which has several components:

1. Earnings from workwhich are fundamentally wages, but also other income, such as that from pensions received.

2. Returns on capitalwhich are those that come from real estate and savings.

3. Income from economic activities.

Four. And the Profits (minus the losses) that occur in personal assets. And, in some cases, the law itself imputes the existence of an income in the exercise.

Keep in mind that not all income is taxed, but the tax is applied after deducting expenses necessary to generate it. For example, Social Security contributions are necessary to obtain wages, so they are not taxed. The same goes for different commissions that are paid in relation to savings.

Besides, is taxed according to a scale in which those with higher income pay more taxes for two reasons. In the first place, because, obviously, they declare more income. But, secondly, because the IRPF is a progressive tax, that is to say, the percentage of the income that is paid by the IRPF is greater in a person who obtains more income.

Positive declaration result

When the result of the return is positive, it means that the income statement has gone out to enter. This means that the State has withheld less money from us than we were entitled to during the fiscal year. When making the compensation in the income statement, the accounts are adjusted and we deliver money that has even remained in our bank account.

Treasury allows payment to be made all at once or in installments in two payments. At the time of submitting the declaration you must pay 60% of the amount and you can delay the payment of the remaining 40% until the end of the year. In order to make the installment payment you must demonstrate that you have no liquidity.

Negative result

In this case, the Treasury must return the money to you. After confirming the draft of your tax return and requesting a refund, in a term between one and six months you will receive the money in your bank account.

Returns with low amounts are made quite immediately, while those of considerable amount usually take longer. But you should receive the refund before the end of the year, since, otherwise, the Tax Agency would have to pay you default interest.

The problem is greater when the one who has to pay is you. If you have a positive result, you must present your return within the term and request the direct debit of the payment or request its installment. If you do not meet the deadlines, the Tax Agency will sanction you and, to the amount you should pay, will add interest.