Medical insurance premiums are exempt from Insurance Premium Tax (IPT), except for the part of the premium intended to cover Travel Assistance.
In general, with Insurance for Individuals, the premiums paid for the current insurance do not confer any rights to any tax benefits. They are not deductible from Personal Income Tax (IRPF in Spanish), and do not confer any rights to deductions or allowances. However, there may be certain special cases in some Autonomous communities.
In the event that the policyholder is a business-owner or a professional who is subject to IRPF under the Direct Estimate Tax Regime, the maximum limit for deductions is 500 euros per person and calendar year, while considering in this sense solely their own cover, that of their spouse and their children aged under 25 years who live with the policyholder. If the policyholder were insuring their employees, the first payment will be tax deductible on their personal tax (Company Tax or Personal Income Tax, IRPF).
The premium will not constitute compensation in kind for the employee with the same quantitive limits per person insured and calendar year as indicated in the previous paragraph. The amount that exceeds these limits would be considered to be compensation in kind and would be subject to the corresponding on-account payment.
The provision of healthcare services does not constitute an income flow for the beneficiary. For this reason, these services are not taxed in the beneficiary’s Personal Income Tax or IRPF.