2022 income tax return: new developments, deadlines, and key dates

As every year, the income tax return has several months circled in red, during which Spanish taxpayers must submit all the documents required by the tax authorities to report their income, expenditure, and investments for the previous tax year.

However, the income tax return in 2022 will be different, because the Personal Income Tax (IRPF) brackets are changing and aid is being introduced for those affected by the eruption of the volcano on La Palma.

When does the filing period for the 2021 income tax return begin?

The time is approaching to file the income tax return for income earned during the 2021 tax year, and the Spanish Tax Agency (AEAT) has already published the calendar with the key dates we need to know in order to comply with our obligations as taxpayers.

The income tax return can be filed online through the Tax Agency’s website, by telephone, or in person. The filing period varies depending on the method you choose. The most important dates are set out below:

• The campaign for filing Personal Income Tax and Wealth Tax (IP) returns electronically begins on Wednesday, April 6. Accordingly, all taxpayers who wish to do so may file their return through the Tax Agency’s website.

• From Tuesday, May 3, workers may request an appointment to file their return by telephone.

• The period for filing the return by telephone begins on Thursday, May 5.

• In-person appointments may be requested from Thursday, May 26.

• The period for filing Personal Income Tax and Wealth Tax returns in person at the Tax Agency’s offices begins on Wednesday, June 1, coinciding with the start of the ordinary period.

• Until Monday, June 27, three days before the end of the campaign, returns showing an amount payable may be filed with payment by direct debit.

• Thursday, June 30 is the deadline for filing Personal Income Tax and Wealth Tax returns.

We recommend that you do not miss any of these dates because, if you fail to meet the deadlines set by the tax authorities and file your return later than required, you may receive a penalty from the tax authorities.

Who has to file a tax return?

-The most common case is that of individuals who receive more than €22,000 solely in gross employment income, whether under joint or individual filing. All taxpayers who exceed that income threshold, which covers salaries, pensions, and other benefits…will have to file a tax return.

-Taxpayers who, in 2021, received solely gross investment income (income from movable capital) and capital gains subject to withholding or payment on account in excess of €1,600 per year, whether under joint or individual filing, are also required to file an income tax return.

-In addition, filing an income tax return will likewise be mandatory where the taxpayer receives solely deemed income from real estate (imputación de rentas inmobiliarias), gross investment income not subject to withholding derived from Treasury bills, and grants for the purchase of government-subsidized or price-controlled housing and other capital gains derived from public aid, in an amount exceeding €1,000 per year.

-As a general rule, taxpayers who receive gross income from more than one payer are also required to file, provided that such income exceeds €14,000 per year and at least the second payer pays more than €1,500 per year.

-All taxpayers who receive more than €14,000 per year in compensatory pensions or maintenance payments other than those covered by Article 7 of the Personal Income Tax Law will also be required to file, as will those receiving employment income from a payer not required to withhold tax or where withholding is applied at a fixed rate.

-This list of persons required to file an income tax return also includes taxpayers who are entitled to the tax credit for international double taxation or who, during the 2021 tax year, made contributions to protected assets of persons with disabilities, pension plans, insured pension plans (planes de previsión asegurados) or mutual provident societies (mutualidades de previsión social), occupational pension plans (planes de previsión social empresarial), and long-term care insurance that reduce the tax base.

What’s new in the 2022 income tax return

1.-Increases for the highest incomes. Workers with annual income of more than €300,000 face a two-percentage-point increase in IRPF, up to 47%. For income of more than €200,000, IRPF rises to 26%. For assets worth more than €10 million, Wealth Tax also rises, from 2.5% to 3.5%.

2.-A fourth bracket for savings income. A fourth bracket is introduced for savings income, that is, returns obtained from dividends on shares, investments in funds, or fixed-term deposits. Savings income exceeding €200,000 will be taxed at a rate of 26%.

3.-Changes to tax relief for pension plans. Tax relief for individual private pension plans is reduced to a maximum of €2,000 (€1,500 from 2022 onward). For employer plans, the limit rises to €8,000. Where a taxpayer has both, the maximum reduction may not exceed €10,000. These must be entered in boxes 462 to 476 of the income tax return. Specifically, contributions to the plans made in 2021 must be reported in box 465.

4.-Special focus on cryptocurrencies. Those who have made gains of more than €1,000 from investing in cryptocurrencies must report them in their income tax return.

5.-Exemptions for those affected by the La Palma volcano. Those affected by the eruption of the volcano on La Palma are exempt from IRPF. This is one of the support measures for those affected that were approved by Royal Decree-Law in October 2021.

Do you need our advice?

Errors and penalties are very common in income tax returns. For this reason, we recommend turning to qualified professionals with expertise in the field to seek help and advice, and leaving in their hands the management and optimization of our obligations as taxpayers.