Saving or constituting a capital or income that serves to supplement our retirement pension is in itself a more important reason, but if we achieve a fiscal saving in the process, we add one more reason.
This is the case of the Insurance Plans Insured (PPAs), it is a life insurance policy with the guaranteed interest rate and that although it has coverage of death, its main purpose is to constitute a capital or a receivable at the time of our retirement The PPA, therefore, have the same purpose as a Pension Plan, and with them they coincide in two points in the liquidity and in its advantageous taxation. In the first point, the insured may not have the accumulated value in their PPA (contributions and interest generated) until the time of retirement or death but there are exceptions, such as tota, severe illness or long-term unemployment duration. In return, we have a very favorable tax regime in the contributions we make to the PPA.
Taxation of contributions, general rule
The premiums paid to the PPA can be subject to a reduction in the taxable income of the IRPF:
- Taxpayers up to 50 years : 10,000 euros or 30% of net income from work and economic activities (the lowest).
- Taxpayers over 50 years old : 12,500 euros or 50% of net income from work and economic activities (the lowest).
The maximum annual contribution is joint for all the social welfare systems, that is, it includes pension plans, social security mutual funds, insured pension plans, corporate social security plans and dependency insurance.
In addition to these direct contributions to our own PPA, there are specific cases. The first case is that of taxpayers whose spouse does not obtain net income from work or economic activities, or whose amount is less than 8,000 euros per year. In this case, the tax base may be reduced by the amount of the contributions made to the PPA of which the spouse is the holder, with a maximum limit of 2,000 euros per year.
The second case is in the contributions to PPA of relatives in direct or collateral line up to third degree, with a degree of physical disability equal or superior to 65%, psychic equal or superior to 33%, as well as of people with disability that have a disability declared judicially regardless of his degree, in which there is a tax limit of up to 10,000 euros per year. Of course, the contributions of family members, plus those of the person with one of the degrees mentioned, can not exceed the maximum set of 24,250 euros per year.
It is important to point out that those contributions that could not have been subject to reduction in the taxable base due to the insufficiency of the same or to the application of the percentage limit, can be applied in the following five years, but always respecting the indicated limits.
The specific case of the Basque Country and Navarre
The Basque Country and Navarre are governed by their own provincial haciendas, which is why they have their own tax regulations. In the Basque Country there is no percentage limit of the income from work and economic activities, so that the contributions made may be subject to reduction in the General Tax Base, regardless of the origin of the income. The limits differ between the different provinces, in Álava and Vizcaya, the limit of private (non-business) contributions to pension plans including PPAs is 6,000 euros up to 52 years and from that age add 500 euros for each year that exceeds 52 to a maximum of 12,500 euros. In Guipúzcoa the limit is 5,000 euros regardless of their age.
In Navarra, a maximum contribution can be made with a deduction of 8,000 euros, which for people over 50 years of age rises to 12,500 euros, with the same limits as in common territory: 30% of their income in general and 50% from 50 years old.