Tax debts in Spain undergoing a voluntary or enforceable payment period may be deferred or paid by instalments, after having submitted the taxpayer’s application, if a business’ financial position prevents it from making payments within the terms required by the Revenue Office.
Although both deferment of payment and payment by instalments involve rescheduling tax debts in Spain, they are not exactly the same. Deferment means extending the term for payment, whereas payment by instalments means spreading repayment of a debt over time, paying each instalment on previously-defined dates.
Application – Deferment and Payment by Instalments of Tax Debts in Spain
The application for deferment and payment by instalments must contain the following information:
- Name and surname, or company name, taxpayer identification number and registered address of the taxpayer or, as applicable, of their representative.
- Identification of the debt whose deferment or payment by instalments is being requested, detailing the amount, item and date of expiration of the term for voluntary payment.
- Reasons for requesting deferment or payment by instalments.
- Terms and conditions for the deferment or payment by instalments being requested.
- Direct debit order, including the identification data of the account and the entity.
- Place, date and signature of the applicant.
Deferment or payment by instalments of tax debts in Spain may be requested provided that the amount concerned is equal to or less than 30,000 euros. If the amount exceeds this threshold, it will depend on the guarantee given by the debtor, and subject to a maximum of 36 monthly payments.
Tax Debts in Spain Not Qualifying for Deferment or Payment by Instalments
Listed below are the tax debts which do not qualify for deferment/payment by instalments:
- Tax debts owed by the tax withholding agent or the taxpayer.
- Tax debts resulting from enforcement of resolutions completely or partially issued in the course of appeal or claim proceedings which had been previously suspended.
- Tax debts derived from taxes which must be legally passed on to another party (VAT or special taxes).
- Corporate Income Tax instalments.
As a general rule, and provided the foregoing conditions are met, the relevant authority will accept applications for deferment and payment by instalments of tax debts in Spain. If an application is rejected, whether because of failure to provide the required documentation, or because the 30,000-euro threshold is exceeded, an electronic notice will be sent to the taxpayer detailing the reasons for rejection of the deferment request, as well as any future consequences.