The differential fee is a magnitude on which a series of calculations are made in the payment of personal income tax. Thus, it is the result of subtracting from the net quota, the payments on account made and the tax compensations.
In other words, the differential fee is the amount resulting from subtracting from the net fee –which is the result of subtracting all deductions and allowances from the full fee–, the payments on account that we have made for the withholdings made by the Tax Agency. in our income and tax compensation, whenever the case arises.
Therefore, we can affirm the following:
- Tax base - Reductions = Full quota.
- Full fee - Deductions = Net fee.
- Net quota - Payments on account - Tax compensation = Differential quota.
- Differential fee - Deduction for adoption or maternity = Result of the declaration.
As we can see, when we are going to pay personal income tax, the calculations that we carry out when calculating the tax offer us various fees that are of vital importance to know the amount that we will have to pay. Or, also, that they must pay us, at the time of paying taxes and rendering accounts to the State in each fiscal year.
In summary, it is the penultimate magnitude that we obtain, a fee to which we will later apply the maternity deduction to obtain the result to be paid, or to be collected, from the income statement for the year in question.
What withholdings and payments on account determine the differential quota in personal income tax?
Withholdings and payments on account, as we know, come from income, among which we can highlight the following:
- Work performance.
- Income from movable capital.
- For urban real estate leases.
- Income derived from economic activities.
- By application of the special regime for the allocation of income.
- Imputations of economic interest groups and temporary unions of companies.
- Imputations of income derived from the transfer of image rights.
- For capital gains, including premiums and subscription rights.
These payments on account and these withholdings must be accredited, with a certificate that will be delivered to the taxpayer, by the persons and entities obliged to withhold or enter.
Likewise, it should be noted that those who are in the installment payment regime must subtract the payments made, those payments on account, from the liquid quota.
Another deduction that should also be highlighted is the one produced by tax compensation when the situation occurs that a taxpayer has changed his habitual residence, and pays personal income tax as a resident and as a non-resident. In this way, a double taxation occurs.
Positive differential fee and negative differential fee or to be returned
After subtracting the payments on account, the installment payments, as well as the exceptional cases mentioned above, we will obtain a differential fee that can be both repayable and positive.
If we apply the reductions and subtract the deductions, we subtract the income on account and the withholdings made, and, calculating the result, we obtain a negative differential fee or, as they say, to be returned, the Administration must pay us the differential amount that we obtain after perform such calculations.
If this differential fee is, on the contrary, positive, we will have to pay the resulting amount in the differential fee to the Administration, within an established period.
This differential fee, as we have said previously, may be slightly modified by the deduction applicable in adoption or maternity situations.