Spain: Granting of deferrals for some tax debts and other measures

Royal Decree-Law 7/2020, of 12 March, adopting urgent measures to mitigate the economic impact of COVID-19 (“RDL 7/2020”) includes the granting of deferrals for some tax debts, provided the following conditions are met:

(1) They must be debts with a total or partial guarantee waiver (i.e., amounting to less than 30,000 euros). The regulation sets this amount by referring to the Order on guarantee waivers. As a result, it is not clear if the latter is fully applicable or not (i.e., if said amount must be the aggregated sum of all deferred periods and taxes or if it refers to each individual tax and period).

(2) The measure touches on the withholding and prepayment of Personal Income Tax (“IRPF”), Value Added Tax (“IVA”) and on fractioned Corporate Tax (“IS”) payments (whose deferral and fractioning were, up until now, not generally allowed).

Only covers returns/liquidations that must be submitted and paid between 13 March and 30 May 2020. The following will be included:

• Personal Income Tax/VAT: corresponding to February, March, and April, as well as those of the first quarter.
  
  (1) Corporate Tax: first fractioned payment and final statement (in certain split years).
  
  (2) This measure is only available to taxpayers who registered a turnover of less than 6,010,121.04 euros in 2019.

• Deferrals will be granted for a six-month period and no interests for late payment will be accrued for the first three months.

In this context, we believe the following scenarios are possible:

A. The taxpayer is able to meet his/her tax obligations:

This is the ideal scenario, so there is no need to analyze it further.

B. The taxpayer does not have the means to meet his/her tax obligations but meets the requirements set forth in RDL 7/2020:

If the taxpayer meets the aforementioned requirements, he/she can ask for a deferral according to the terms and conditions mentioned above.

C. The taxpayer does not have the means to meet his/her tax obligations and does not meet the requirements set forth in RDL 7/2020:

In principle, the requirements set forth by RDL 7/2020 are clear. However, we believe taxpayers whose debt exceeds 30,000 euros and/or whose 2019 turnover exceeds the amount stated may also push for this sort of deferral.

We believe the granting of deferrals should include taxpayers who had a turnover of more than 6,010,121.04 euros in 2019, so as to avoid discriminatory stances that go against the very principles that govern our tax system. Following a similar line of reasoning, one might also call for the deferral of sums over 30,000 euros in certain cases.

We believe we could also fight the imposition of penalties, as well as of surcharges, for defaults caused by force majeure events.

It is worth noting that the following months will bring plenty of new scenarios. As a result, it is crucial to study matters on a case-by-case basis so as to plan the best possible strategy.

Other measures

Electronic certificates expiring soon

In its website, the Spanish Tax Agency has published a warning that reads as follows:

“The Spanish Tax Agency informs taxpayers whose electronic certificate is about to expire, or has already done so, that it will allow the use of said certificates in its site in accordance with the provisions set forth in Royal Decree 463/2020, of 14 March.

If you encounter problems with your regular browser, we suggest switching to Firefox (where you can carry on using it).”

Cadaster formalities

The time limit to reply to information requests and orders submitted by the General Directorate of Cadaster will be extended to 30 April 2020, provided this time limit had not already expired when Royal Decree-Law 8/2020, of 17 March, on extraordinary urgent measures to face the economic and social impact of COVID-19 (“RDL 8/2020”) entered into force (18 March 2020).

The periods to take appropriate measures regarding the launch of allegation procedures or hearings notified by the General Directorate of Cadaster from 18 March 2020 will be extended to 20 May 2020 (unless the general rule sets a longer period, in which case the latter shall apply).

If the taxpayer complies with the court order, supplies the information with tax significance requested or submits his/her allegations, the proceedings will be deemed fulfilled.

The period ranging from 18 March to 30 April 2020 will not be taken into account when setting the maximum duration for procedures launched by the authorities. However, during this period, the Administration can order, prescribe, or carry out essential formalities.

Exemptions from the Property Transfer and Certified Legal Documents Tax for certain mortgage operations

The first final provision of RDL 8/2020 modifies Royal Legislative Decree 1/1993, of 24 September, approving the consolidated text of the Law on Property Transfer and Certified Legal Documents Tax.

This way, a new number is introduced under article 45.I.B) to declare notarial documents and formalization deeds on credit contract novations and mortgages concluded under RDL 8/2020 are exempt from the gradual fee to be paid for Certified Legal Documents.

Customs formalities

Import customs formalities for the industrial sector shall be streamlined. To do so, the Customs and Excise Department of the Spanish Tax Agency can authorize the customs declaration and clearance procedure to be carried out using the computer applications available, without any amendments on the part of bodies or officials working for the Customs and Excise Department.