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Olga Galindo Carazo.  

If your withholdings are calculated correctly, you may want to update Form 145.

To make sure that your personal income tax withholdings are calculated correctly, you may need to update Form 145. You may not remember it, but you submitted it when you signed your employment contract, years ago in any case.

What is Form 145 and what is it for?

Let’s start at the beginning.

Form 145¹ (available for download in pdf format on the AEAT’s own website) is the form by means of which employees inform their employer, the payer of their salaries, of certain personal circumstances, such as their marital status, whether or not they have dependent children, the age of the children and another series of circumstances that the law contemplates and serve to determine whether the IRPF withholding is higher or lower.

Sometimes it happens that you earn the same as a colleague but he earns more (or less) than you. It is because earning and being paid are different things.

The net salary, the salary that you finally receive in the bank, can vary depending on the percentage of taxes, of IRPF, that the company withholds from your paycheck. The company deducts it but pays it to the Treasury, on account of what is known as the income tax return, the annual income tax return.

The percentage of withholding varies, upwards or downwards, depending on personal circumstances, it depends on the marital status, if we are married or not, if the spouse works or not, if you have children or not, and how many, of what ages, etc., etc., etc.

There are several circumstances that are taken into consideration. All of them are declared by means of Form 145.


When do I have to file Form 145?

It is obligatory to present the Form 145 at the beginning of the employment relationship, together with the employment contract.

From that moment on, it is the workers who have to update the Form in the event that these circumstances change, because you get married, you have children, or they reach the age of majority and are no longer in your care, and some other factors.


What happens if you do not update the Form 145?

If your circumstances change but you do not notify it, the result will be that the withholding rate will not be adjusted to the result of your annual income tax return.


Is that good or bad?

It depends on how you look at it.

If the withholding applied is higher than it should be, you will be harmed month by month, you will receive less than you should, your liquid salary, that is to say, what you receive in the bank, will be lower than it should be. However, at the moment of making the annual declaration of the IRPF, there will be a differential quota in your favor that in some circumstances can be an important amount. That is to say, the IRPF will be returned to you and by a lot.

If the withholding is lower than it should be, you will receive a higher net amount every month, but when you receive your income tax return, you will have to pay everything you did not pay during the year. The problem will come when you make the annual IRPF declaration in which you will have to pay a differential quota, in some cases for an important amount. That is to say, you will have to pay the IRPF and by a lot.


So, what do I do with the Form 145?

You should review the copy of the Form that you filed and check if anything has changed since then.

If you can’t find it, maybe it’s enough to do some memory check, maybe your situation hasn’t changed since you started working for the company.

And if in doubt, it is better to update the Form 145. This way you can be sure that the withholding will be correct and there will not be a big difference between the withholding that is applied to you month by month, and the amount that you will receive when you file your income tax return in June of next year.


When is the best time?

It is best to do it at the beginning of the year, if there is any difference, more or less, it will be distributed throughout the year.

If you do it at the end of the year, there may be a significant difference between the withholding that has been applied to you and the one resulting from your new family situation.

January 2024.

¹Encuentre aquí el Modelo 145 de la Agencia Tributaria

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