Income tax deduction
The National Insurance Institute does not deduct withholding tax at the time the grant is paid, but the grant is considered income to all intents and purposes by the income tax authorities and it is taken into account along with other income for the purpose of calculating tax.
A discharged soldier whose income reached the tax threshold in the year in which he received the grant may be required by the income tax authorities to pay tax on the grant, when it conducts a tax adjustment or when the annual tax return is submitted, whether the return was submitted at his initiative for the purpose of a tax refund or at the request of the income tax authorities.