As a result of the queries we have received regarding teleworking and, in particular, the tax treatment of expenses incurred in this modality, we remind you that the Internal Revenue Service (SII) recently published Circular No. 53 of 2020 (ORD. No. 2139 DE 29.09.2020), related to the payment of bonuses to workers to compensate for expenses caused by teleworking.
The SII indicates that the remunerations received by dependent workers constitute income classified in Article 42, No. 1, of the LIR, taxed with the Single Second Category Tax (IUSC), under the terms of Article 43, No. 1, of the same law.
In that sense, provided that it is a compensatory allowance, which constitutes a sort of reimbursement of the expenses incurred by the worker on account of the teleworking, taking into account the circumstances and amounts involved, such bonus does not constitute remuneration nor is it part of the taxable base of the IUSC.
As indicated above, the payment of a compensatory allowance for expenses incurred in connection with teleworking does not constitute income for the worker and, consequently, is not taxable.
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