In the case of pensions received from Germany, for the calculation of the net income from personal work corresponding to such pensions, for Personal Income Tax (LIRPF), the amounts deducted from such pensions by the corresponding German Agency to cover the contingencies of the Compulsory Health Insurance and the Social Assistance or Dependency Insurance must be considered as deductible expenses.
The Central Economic Administrative Court has unified criteria in its resolution 00/05942/2020/00/00 of March 23, 2021, in the sense that the obligatory amounts paid to the corresponding German Agency can be deducted from the pensions received from Germany, for the calculation of the net yield of the work, its main arguments are:
1.- THE criterion and established by the CJEU in a similar case, judgment of the CJEU of 23/04/2009 issued in case C-544/07, which we partially reproduce:
< 1 The reference for a preliminary ruling concerns the interpretation of Articles 12 EC and 39 EC.
2 That reference was made in the course of proceedings between Mr. Rüffler, a German national resident in Poland, and Dyrektor Izby Skarbowej we Wroclawiu Osrodek Zamiejscowy w Walbrzychu (Director of the Tax Administration of Wroclaw, Walbrzych Branch, hereinafter, "Dyrektor") by the refusal of the Polish tax administration to allow him to deduct health insurance contributions paid in another Member State from income tax, whereas such a deduction is allowed to a taxpayer who pays health insurance contributions in Poland.
On those grounds, the Court (Third Chamber) hereby rules:
Article 18(1) EC precludes legislation of a Member State which makes the grant of the right to deduct paid sickness insurance contributions from income tax conditional on the contributions being paid in that Member State, in accordance with provisions of national law, and refuses to grant such a tax advantage where contributions deductible from income tax payable in that Member State are paid under a compulsory sickness insurance scheme of another Member State. >
2.- The "principle of justice" that should govern the Spanish tax system:
The Spanish I.R.P.P.F. is a tax levied on "the income" -art. 1 of Law 35/2006- of the taxpayers subject to it, "income" of such taxpayers being the object of said tax -art. 2 of Law 35/2006-, "understood as the totality of their income, capital gains and losses and the imputations of income that are established by law, regardless of the place where they were produced and whatever the residence of the payer may be".
Well, if from what a taxpayer receives as "gross" for one of the components of that income, a certain amount is deducted by a legal and inexcusable obligation, it seems evident that his income for such component will amount to the gross amount minus what has been deducted, and that he will only have to pay tax for that "net" amount, Let us call it this way, because if he is taxed on the "gross" amount, he will be taxed on an income, or rather on a part of an income, which he will not have effectively obtained, and this will clearly violate the principle of justice mentioned above.
And the TEAC argues along these lines:
Because, in addition, if this is looked at from another point of view, it may be that the way of paying that income: either directly a "net", or a "gross" from which certain amounts are deducted, is nothing more than a way, and well didactic by the way, to explain to the taxpayers what their public contributions are spent on; and with what happened in the case of the obligee in the year 2014 (and in the other three the same) it is perfectly explained what this Court has just expressed.
In 2014 the obligee received a "net" pension of 14,975.46 euros.
If that pension had been paid to her by the Spanish Social Security, the obligee would have known that, that she had received a "net" pension of 14,975.46 euros.
However, since the pension was paid to her by the German Social Security, the obligee knew that she had received a "gross" pension of 17,579.10 euros, from which the German Social Security had deducted a total of 2,603.64 euros for health insurance and dependency insurance (social assistance), as a result of which it had paid her a "net" of only 14,975.46 euros.