IRPF as a family unit: when a couple benefits from filing jointly

Few couples know that IRPF offers an option that, in certain cases, lowers the total tax: filing as a family unit (núcleo familiar). It isn't always worth it, but when the couple's incomes are very different it can make a difference. Here's what it is and how to evaluate it.

What the family unit is

It's the possibility for a couple to combine their labor income and settle it jointly, instead of each filing separately. It's not mandatory: it's an alternative you choose only if it helps.

Per DGI:

«La liquidación por núcleo familiar no es obligatoria, sino que constituye una opción. Solo aplica a las rentas del trabajo (Categoría 2).»

In English: Filing as a family unit is not mandatory, it constitutes an option. It only applies to labor income (Category 2).

Who can form it

The option is designed for formalized couples, with some conditions:

• Spouses not separated as to property and without prenuptial agreements.
• Judicially recognized domestic partners (concubinos).
• All members must be resident individuals.
• None may be a taxpayer of IRAE, IRNR, IMEBA or IASS.

It's decided year by year

It isn't a permanent decision: each year you choose whether it suits you, by filing the corresponding return. Note, though: once filed as a family unit, that choice is definitive for that year.

And on choosing:

«La opción se realiza año a año y se materializa presentando la respectiva declaración jurada.»

In English: The option is exercised year by year and is materialized by filing the corresponding sworn declaration.

When does it usually pay off?

As a general rule, it tends to help when there's a large income gap between the two members (for example, one earns a lot and the other little or nothing), because the scheme can make better use of the non-taxable minimum and the lower brackets. When both earn similarly, filing separately is usually better. The safest approach is to compare both calculations before choosing. The regulatory detail is in Title 7:

At a glance

In short: the family unit is an annual option for couples that can reduce IRPF when incomes are uneven. Compare both calculations before deciding and confirm the conditions with DGI.