The amount that Juan del Val will have to pay to the Treasury for winning the Planeta award

The journalist, writer and collaborator of The Anthill Juan del Val has become the 74th winner of the Planeta awardawarded with one million euros, for his novel Vera, a love story. For its part, the finalist was the Galician Angela Banzas with When the wind speaks, a plot in post-war rural Galicia about the mysterious discoveries that the protagonist, Sofía, meets in a hospital where she is admitted, among them, that she had a missing twin sister, when the wind speaks.

The Planeta award is the highest paid literary recognition in Spain. Its financial endowment is one million euros for the winner and 200,000 euros for the finalist, making it one of the best-paid prizes in the world.

According to tax experts from the tax platform TaxDown, The Planeta Prize is not exempt from paying taxes. Article 7.I) of the Personal Income Tax Law contemplates that some relevant literary, artistic or scientific awards may be exempt from taxation if they meet certain requirements, such as not involving the transfer of intellectual or industrial property rights. In the case of the Planeta Prize this would not be the case since the prize implies the transfer of exploitation rights of the work to the publisher (Grupo Planeta).

In this sense, it must be remembered that personal income tax is a progressive tax, so different percentages will be applied depending on the brackets that correspond to each case. In this way, three aspects must be taken into account: the amount of the prize, the income and the Autonomous Community in which the taxpayer residessince the latter will also cause the applicable rate to vary.

In this case, Juan del Val, a native of Madrid, and the new winner of the Planeta Prize, will have to pay, on the one hand, around 24.50% of the state scale and, on the other, approximately 20.50% for the Autonomous Community. As a consequence, the state Tax Agency and the autonomous Treasury of Madrid will be left with exactly €433,417.60as reported by TaxDown. It is important to remember how the different income tax brackets are calculated and why they are not €450,000 total. The first €12,450 of the state scale is subject to 9.5% and only from €300,000 onwards is that amount taxed at 24.50%.