Today we touch on a subject that falls within the field of divorce taxation and that may seem curious or infrequent, but that occurs more frequently than we think. It is not uncommon that there are fathers or mothers who have been divorced on more than one occasion and who must pay three or more alimony payments to their children at the same time, regardless of the marriage of which they are the fruit. In these cases, can the deduction for large family be applied even if the “large family” really corresponds to different family units?
We study this case through a recent consultation of the Directorate General of Taxes (DGT), which resolves this issue in a binding way. Remember that we put at your disposal family lawyers and we also advise you from the fiscal and patrimonial point of view, so that you always take the most convenient decisions from the economic point of view. Consult us about your case.
Large family deduction: Can it be applied when there are several families?
The DGT begins by recalling the regulations that apply to this case.
Firstly, Article 81 bis of Law 35/2006, on Personal Income Tax (IRPF).
According to the DGT, it follows that “in order to be able to apply the deduction for a large family, one must be an ascendant, or a sibling orphan of father and mother, who is part of a large family in accordance with Law 40/2003, of November 18, 2003, on the Protection of Large Families.
Thus, according to the latter Law…
“Shall be equated to large family, for the purposes of this law, families consisting of:
a) One or two ascendants with two children, whether or not they are common, provided that at least one of them is disabled or unable to work.
b) Two ascendants, when both are disabled, or at least one of them has a degree of disability equal to or greater than 65 percent, or is unable to work, with two children, whether or not they are common.
c) The separated or divorced father or mother, with three or more children, whether or not they are common, even if they are in different family units, provided that they are under their economic dependence, even if they do not live in the marital home.
In this case, the parent who chooses to apply for recognition of the status of large family, proposing for this purpose to take into account children who do not live with him, must submit the court decision declaring his obligation to provide them with maintenance.
In the event that the parents do not agree on the children to be considered as part of the family unit, the criterion of cohabitation will apply.
(…)”.
In addition, Article 5 of Law 40/2003 establishes the following with respect to the recognition of the status of large family:
“1.
The condition of large family shall be accredited by means of the official title established for such purpose, which will be granted when the requirements established in this law are met, at the request of any of the ascendants, guardian, foster parent, guardian, or other member of the family unit with legal capacity.2. It corresponds to the autonomous community of residence of the applicant the competence for the recognition of the condition of large family, as well as for the expedition and renewal of the title that accredits this condition and category. For the purposes of this law, this title shall be valid throughout the national territory without the need for any act of recognition.
The minimum and indispensable content to ensure its effectiveness shall be determined in the regulatory development of this law”.
Taking into account these regulations, the DGT concludes that “in the case in question, in which according to the data provided, the divorced taxpayer is the father of 3 children from two different marriages to whom he is obliged to pay alimony, and does not have the title of large family, he will not be entitled to the deduction for large family in accordance with the above”.
Thus, when the parent chooses to apply for recognition of the status of large family, proposing for this purpose that children who do not live with him/her be taken into account, must present the court decision declaring his or her obligation to provide them with maintenance. And in the in the event that there is no agreement between the parents on the children to be considered in the family unit, the criterion of cohabitation shall apply.
Application of the minimums for descendants
On the other hand, the DGT resolves that, as regards the requirements for the application of the minimum for descendants, the parent who has the custody of the children may apply the minimum for descendants as they are the persons with whom they live. Likewise, those who do not live with the children but provide them with food by virtue of a court decision, from 2015 can choose to apply the minimum for descendants by supporting them economically, or by applying the treatment provided in the Personal Income Tax Law for the annuities for food. In this case, the taxpayer may apply the minimum for descendants with respect to his three children, to whom he pays alimony, as long as such obligation continues and is contained in a judicial decision or a judicially ratified regulatory agreement.
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