SPAIN: COVID-19: FISCAL MESAURES IN ROYAL DECREE-LAW 15/2020

José DutilhManaging Partner, LeQuid, The J.Dutilh Law Firm For Social Impact

This regulation includes measures of a fiscal or tax nature, which can be classified into the following 4 blocks:

  • VAT on goods necessary to combat the effects of COVID-19.
  • Corporation Tax – instalment payments.
  • Objective estimate of Personal income tax [IRPF] and Simplified VAT regime.
  • Executive procedure debts for which financing has been requested.

VAT on goods necessary to combat the effects of COVID-19.

  • 0% VAT tax rate
  • Deliveries of goods, imports and intra-community acquisitions of goods referred to in the Appendix.
  • Public Law entities, clinics or hospital centres, or private social entities referred to in section three of article 20 of Law 37/1992, of December 28, on Value Added Tax.
  • These transactions will be documented on the invoice as exempt.

Corporation Tax – instalment payments.

The case of taxpayers of this Tax are regulated for those who could not take advantage of the extension for instalment payments, approved by Royal Decree-Law 14/2020, for invoicing more than €600,000 and less than €6,000,000 per year.

In order to adapt the calculation applicable to anticipated tax payments to economic reality, for tax periods beginning on or after January 1, 2020, and with exclusive effects for said period, the following is allowed:

  • That taxpayers with a turnover of less than 600,000 euros exercise the option for instalment payments, on the part of the tax base for the period of the first 3, 9 or 11 months, by filing within the period extended until May 20.
  • That taxpayers with a turnover of between 600,000 and 6,000,000 euros, it is foreseen that the taxable base option can be made within the instalment period, which must be presented in the first 20 days of October 2020, also determined by application of the aforementioned type of tax base.

Modules. Objective estimate of Personal income tax [IRPF] and Simplified VAT regime.

Due to the unique characteristics of these special tax regimes, known as “module taxation” and the difficulties arisen for those who pay taxes under these special regimes, especially for access to extraordinary packages of approved aid, there have been many waivers, enabled by exceptional regulations, to these special regimes.

In addition, problems are generated in the calculation of quotas, which the regulation attempts to solve.

Tacit waiver of objective estimation in personal income tax

Personal income taxpayers who have waived the objective estimation may return to the objective estimation method in the 2021 tax year, provided that they meet the requirements for its application and revoke the waiver of the objective estimation method within the period established by the regulations.

Objective estimate [of] instalment payments for personal income tax and simplified VAT regime

For these purposes, the calendar days in which the State of Alarm has been declared will not be taken into account as days of activity. This will apply to each quarter in which this occurs.

Executive procedure debts for which financing has been requested.

Tax returns or settlements are regulated, when filed without having made the deposit of their contained amounts.

The executive claim procedure will not be initiated, provided that funding has been requested from the extraordinary funding programs approved by the health crisis, and that the following requirements are met:

  • Have requested financing for at least the amount of those tax debts.
  • Provide the Tax Administration, up to 5 days after the end of the term for the declaration or settlement, a certificate from the financial institution stating that financing has been requested, detailing the amounts and tax debts for which it has been requested.
  • Granting of financing, with a minimum amount of tax debts.
  • Payment of the debt, in full and immediately after granting the financing.