The 7p) exemption in the IRPF covers the days of travel to the country of destination or return to Spain.

Included among the earned income received for work effectively carried out abroad to which the exemption provided for in Article 7 p) of Personal Income Tax Law 35/2006 applies, are those corresponding to the days of travel to the country of destination or return to Spain.

The question under discussion here is whether the exemption regulated in article 7 paragraph p) of the Personal Income Tax Law 35/2006, should also apply to those days in which the interested party travels abroad to render services for a non-resident entity.

Article 7.p) of Law 35/2006, of November 28, on Personal Income Tax and partially amending the Corporate Income Tax, Non-Resident Income Tax and Wealth Tax Laws, establishes that "the following income shall be exempt:

...

p) The income from work received for work effectively carried out abroad, with the following requirements:

1.º That such work is carried out for a company or entity not resident in Spain or a permanent establishment located abroad under the conditions established by regulations. In particular, when the entity receiving the work is related to the employee's employer or to the entity in which the employee provides services, the requirements set forth in section 5 of Article 16 of the revised text of the Corporate Income Tax Law, approved by Royal Legislative Decree 4/2004 of March 5, 2004, must be met.

2.º That in the territory in which the work is carried out a tax of an identical or analogous nature to that of this tax is applied and it is not a country or territory considered to be a tax haven. This requirement will be considered to be met when the country or territory in which the work is carried out has signed an agreement with Spain to avoid international double taxation that contains an information exchange clause.

The exemption will be applied to the remuneration accrued during the days of stay abroad, with a maximum limit of 60,100 euros per year. Regulations may establish the procedure for calculating the exempt daily amount....

On the other hand, Article 6 of the Tax Regulations, approved by Royal Decree 439/2007, of March 30 (BOE of March 31), RIRPF, provides as follows:

"1. The income from work received for work effectively carried out abroad shall be exempt from tax, in accordance with the provisions of Article 7.p) of the Tax Law, when the following requirements are met:

1.º That such work is carried out for a company or entity not resident in Spain or a permanent establishment located abroad. In particular, when the entity receiving the work is related to the entity employing the employee or to the entity in which the employee provides services, the work will be deemed to have been carried out for the nonresident entity when, in accordance with the provisions of paragraph 5 of Article 16 of the revised text of the Corporate Income Tax Law, it can be considered that an intragroup service has been provided to the nonresident entity because the said service produces or may produce an advantage or profit for the entity receiving the work.

2. That in the territory in which the work is carried out a tax of an identical or analogous nature to that of this tax is applied and it is not a country or territory classified by regulations as a tax haven. This requirement will be considered to be fulfilled when the country or territory in which the work is carried out has signed an agreement with Spain to avoid double international taxation that contains an information exchange clause.

2. The exemption will have a maximum limit of 60,100 euros per year. For the calculation of the remuneration corresponding to the work carried out abroad, the days that the worker has actually been abroad must be taken into consideration, as well as the specific remuneration corresponding to the services rendered abroad.

For the calculation of the amount of the income earned each day for work performed abroad, apart from the specific remuneration corresponding to the aforementioned work, a proportional distribution criterion shall be applied, taking into account the total number of days in the year".

The question that arises has not yet been answered by the Supreme Court, as it is pending appeal in cassation, since the First Section, has issued an Order of Admission of Appeal in Cassation RCA/1990/2019, dated 21/11/2019 (Roj: ATS 12393/2019 and Id Cendoj: 28079130012019201770), inasmuch as it understands that it is of interest for the formation of jurisprudence to specify the scope of the expression "income from work received for work effectively performed abroad" and, in particular, if in such concept should be understood as including the amounts received by the worker in attention to the days of travel to the country of destination or return to Spain. The order states:

"To clarify the scope of the expression "income from work received for work effectively carried out abroad" contained in article 7.p ) LIRPF and, in particular, if in such concept should be understood to include the allowances or the amounts received by the worker, in attention to the days of travel to the country of destination or return to Spain.

3. This question presents an objective interest for the formation of jurisprudence, because the rule that supports the reason for deciding the disputed judgment has never been interpreted by the Supreme Court in a factual situation such as that involved in the litigation (worker who considers exempt the remuneration received from his employer for the days of actual travel to perform the tasks abroad that produce the legally exempt income) - article 88.3.a) LJCA -, for which reason a pronouncement of the Supreme Court that clarifies it is advisable".

The SC, in judgments dated March 28, 2019 (Appeals number 3774/2017 and 3772/2017) and, subsequently, on April 9, 2019 (Rec. 3765/2017), elaborated on the rules that concern us various interpretative criteria. It stressed that "the tax incentive aims at the internationalization of human capital with residence in Spain, reducing the tax burden of those who, without ceasing to be residents, temporarily move to work abroad. It is not intended for the benefit of the companies but for the benefit of the workers". Thus, it states in its Second Ground of Law that: "The restrictive or, more precisely, strict interpretation, which, in principle, must be made of the rules that establish tax benefits or incentives, cannot give a result contrary to logic, to the letter of the law or, in general, to the hermeneutic criteria set forth in paragraphs 1 and 2 of Article 12 of the LGT".

In particular, it is clear that it is not possible to demand requirements for the enjoyment of the exemption that we are examining that are not foreseen in the precept that establishes it, so that from this hypothesis it is possible to apply the exemption to days in which the worker has been displaced, since at no time do the regulatory norms refer to actual days of work, since the Law or the Regulation do not contemplate it and it is not possible to demand more requirements than those foreseen in the precept. And this is the transcendental question, from the hermeneutic criterion indicated we must conclude that in article 7, p), the LIRPF, the term "days of stay" is used and the Regulation uses the term "days that the worker has been effectively displaced", therefore the effectiveness of the displacement begins from the time the worker stops being in Spain until he returns, since the day of the displacement is undoubtedly work time that the worker does not render in Spain.

Finally, the TEAR of Valencia states:

Consequently, in accordance with the criterion contained in the aforementioned ruling, and which this Court endorses, -constituting a change of criterion with respect to previous decisions of this Court-, it is appropriate to accede to the claim of the interested party including among the work income received for work effectively carried out abroad to which the exemption provided for in art. 7 p) of Law 35/2006, of Personal Income Tax, those corresponding to the days of travel to the country of destination or return to Spain is applicable.