When spouses legally separate and have minor children with shared custody and guardianship, one of the most common questions is how they should be taxed before the tax authorities. In Tecem Abogados, specialized in tax advice in Malaga, Benalmadena and the Costa del Sol, we explain the tax implications for parents in this situation, according to current regulations.

Joint or individual taxation?

According to current regulations, in cases of legal separation or divorce with minor children under joint custody, if the former spouses do not reach a prior mutual agreement on who will be taxed jointly, both will be taxed under the individual taxation regime. This means that neither of them will be able to apply the reduction for joint taxation, which currently amounts to 2,150 euros (LIRPF art. 84.2.4º). It is important to point out that this agreement between the former spouses must be prior to the filing of the tax returns. If the existence of such agreement is not justified, the Tax Agency will proceed to verify the tax returns and, if necessary, will oblige both parents and the minor children to pay taxes individually.

Typical situations in practice

In practice, it is common for both ex-spouses to file their tax returns under the joint taxation without having reached a prior agreement. When this happens, the Tax Authorities intervene to regularize the situation, applying individual taxation for both parents and their children. This process can be initiated through verification or inspection procedures of the self-assessments, or even through the processing of an appeal for reconsideration if the situation is detected later.

Possible alternatives in the taxation of separated spouses

Although the current criteria obliges individual taxation if there is no agreement, some experts and entities such as the Council for the Defense of the Taxpayer have proposed alternatives to improve the tax situation of separated spouses with shared custody. Among these alternatives are: 1.Application of half of the reduction: That each parent can apply half of the reduction of 2,150 euros, that is, 1,075 euros each.Exception for forming part of two family units: It is proposed to allow both former spouses to be taxed jointly and to apply half of the reduction, even in cases of shared custody. However, these alternatives require legislative amendments, so the Central Economic Administrative Court (TEAC) has made it clear that, at present, the current regulations that establish individual taxation in the absence of prior agreement between the former spouses apply.

Tax consequences of failure to reach an agreement

When no agreement is reached between the former spouses as to who is entitled to joint taxation, both will lose the right to apply the reduction for joint taxation and will be obliged to pay tax individually. In addition, any attempt to modify this option after the filing of the tax returns will be rejected by the Tax Agency.

Tax advice in separation and shared custody cases

At Tecem Abogados, we understand the complexity of tax situations that arise after a separation or divorce. Our team of tax advisors and lawyers specialized in family law can help you optimize your tax situation and avoid problems with the tax authorities. If you are separated and have doubts about how to declare your taxes, do not hesitate to contact Tecem Abogados for a personalized consultation. We have offices in Malaga, Benalmadena and other locations on the Costa del Sol, providing a comprehensive service of tax and legal advice for both individuals and companies.