The Covid-19 pandemic has led millions of Spaniards to change their usual workplace for their home in recent months, including self-employed workers who have carried out their business from home, at least temporarily. Although the regulations enable the self-employed to deduct almost a third of household expenses for the corresponding part of the same that is allocated to professional work, the Treasury has just denied the group this tax advantage in cases related to the situation caused by the virus claiming that it is an “occasional and exceptional” situation.
This has just been determined by the General Directorate of Taxes in response to a binding inquiry made by a self-employed worker. The self-employed person who presented the doubt to the body dependent on the Ministry of Finance reported that she usually carries out the economic activity that she carries out as self-employed in an office located outside her home, under the method of direct estimation of her net income.
However, and due to the situation derived from the spread of Covid-19 in Spain, the taxpayer has stopped going to the office daily, opting to work assiduously from her home. As a result, he reports, he makes professional use of some of the household supplies, such as electricity or internet access, which has led to an increase in the usual expense he borne as a mere resident at home. As a consequence, the autonomous claims the possibility of deducting the expenses derived from the transfer of their professional activity to the home.
In order to answer the question, the General Directorate of Taxes goes to the pertinent regulation, in this case Law 35/2006, of November 28, on Personal Income Tax and partial modification of corporate taxes , on Non-Resident Income and on Equity, which regulates which of the costs “will be considered a deductible expense for determining the net income in direct estimation.”
The rule specifies that, “in cases where the taxpayer partially affects his habitual residence to the development of economic activity, the expenses of supplies of said dwelling, such as water, gas, electricity, telephony and Internet” may be deductible “in the percentage resulting from applying 30% to the existing proportion between the square meters of the house destined to the activity with respect to its total surface ”, unless another specific figure is duly demonstrated.
Based on this wording, alleges Taxes, “for certain supplies of the taxpayer’s habitual residence to be considered as deductible expenses of an economic activity carried out by him, it is necessary that the habitual residence is partially affected by the activity.” However, he concludes, “this circumstance does not occur in the case presented, as it is not partially affected by the activity, and its use in the development of the activity is motivated by an occasional and exceptional circumstance” related to the pandemic.
“Therefore, the expenses for supplies mentioned in the consultation cannot be deducted,” he dictates, closing the door to thousands of freelancers who have worked at home for months, out of prudence or obligation, to take advantage of the tax advantage that those have. who usually work from home.
This relief was limited in the self-employed law endorsed by the Congress of Deputies in 2017, to try to end the judicial pulses around the matter. As a result, a worker with a house of 100 square meters that allocates 20 of them to the workplace will be able to benefit from a deduction of 30% of that proportion, that is, a tax reduction of only 6% on the total bill of the supplies associated with the payment of the Personal Income Tax.
After the TEAC ruling. Hacienda has given its arm to twist. The General Directorate of Taxes has ended up modifying its criteria to allow citizens who receive a favorable judicial opinion that includes being compensated with the collection of court costs to stop facing a tax bill after the Economic-Administrative Court Central (TEAC) will rule against it, last June, in a resolution advanced by this newspaper. After that opinion, the General Directorate of Taxes has ended up publishing a binding resolution in which it allows to compensate said capital gain with the deduction of the expenses that have involved the lawsuit. From now on, therefore, and without having to go to court, the beneficiaries of legal costs will only have to pay for the amount received in the amount that exceeds the invoice of the litigation, being totally exempt from not exceeding said amount. It is, says Almudena Velázquez, legal co-director of reclamador.es, of “a decision that seems logical” but that comes “bound by the resolution” of the TEAC that “already had to revoke the criteria of the Tax Agency applying the sense common”.