COVID – 19: Tax measures

Tax measures approved by the Government of Spain

Last March 12th and 14th, the Spanish Government issued Royal Decrees (Royal Decree-Law 7/2020 of 12 March and Royal Decree 463/2020 of 14 March) containing various measures in the field of taxation. These measures have an impact on the payment of tax debts, as well as on administrative procedures, expiration dates and statutory limitation periods.

With regard to the payment of tax debts, Royal Decree-Law 7/2020, and in particular article 14 thereof, provides firstly that 'the deferment of the payment of the tax debt will be granted for all those tax returns and self-assessment tax forms for which the period for submission and payment ends from the date of entry into force of this Royal Decree-Law and until 30 May 2020', provided that these tax debts are of a lower amount than the one provided in the applicable tax legislation (Article 82.2 a) Law 58/2003 of 17 December 2003, General Tax Law). The Royal Decree came into force last March 13th, with regard to the amount of tax debts, they cannot exceed EUR 30.000.

Secondly, article 14 establishes that the deferral shall also apply to withholding taxes and payments on account (installments) regarding the Corporate Income Tax.

Thirdly, for such deferrals to be granted, it is important to bear in mind that, "it shall be a necessary requirement for the granting of the deferral that the debtor being a person or entity with a volume of transactions not exceeding 6.010.121,04 euros in the year 2019".

Fourthly and lastly, article 14 establishes that the deferrals will be granted for 6 months and no interest on arrears will accrue during the first three months of the deferral.

In order to request deferrals, tax returns and self-assessment tax forms shall be submitted through the usual procedures, indicating the request for deferral ("acknowledgement of debt" option). Once within the process of filing the request for deferment, the fields of the request must be filled in, indicating the following in the "Reason for the request": "RDL postponement".

In addition, Royal Decree 463/2020 introduces, in its third and fourth additional provisions, the suspension of administrative procedures, terms and the statutory limitation periods.

With regard to the suspension of administrative deadlines, the third additional provision provides as follows:

  1. The terms are suspended and the deadlines for processing procedures of public sector entities are interrupted with exceptions (procedures and resolutions referring to situations linked to the circumstances of the Royal Decree). The deadlines will be resumed when the application of the Royal Decree finalizes or, if applicable, its extensions.
  2. The suspension of terms and the interruption of deadlines apply to the entire public sector as defined in Law 39/2015 of October 1st on the Common Administrative Procedure of Public Administrations.
  3. Notwithstanding the above, the competent authority might agree, by means of a reasoned resolution, to measures of organization and instruction of the procedures that are strictly necessary to avoid serious damage to the rights and interests of the interested party in the procedure and as long as the interested party agrees, or when the interested party agrees with the non-suspension of the term.
  4. This provision shall not affect the procedures and resolutions referred to in the first section, when they are related to situations closely related to the facts justifying the provisions adopted.

This means the various public tax administrations of the State, the Autonomous Communities (“Comunidades Autónomas”) and the Local Corporations, from March 14th, will have the terms regarding the procedures for the application of the taxes and their review through administrative channels suspended or interrupted.

With regard to the suspension of the terms and the statutory limitation periods, the fourth additional provision establishes the following:

"The statutory limitation periods and terms of any action and right shall be suspended during the period of validity of the state of alert and, where appropriate, of any extensions adopted".

From B LAW&TAX we will keep you informed about the additional measures that might be adopted by the Spanish Government, as well as the communications and instructions that might be issued by the Spanish Tax Administration with impact on taxes and tax obligations.

Tags: Royal Decree-Law, BOE, COVID-19, Government of Spain, tax debts, administrative procedures