Emergency Measures Against COVID-19 in Spain

James Berrio

Last March 13th and 18th, the Spanish Government published three Royal Decrees, Royal Decree-Law 7/2020 regarding “urgent measures to address the economic impact of COVID-19”, Royal Decree-Law 8/2020 in relation to “extraordinary urgent measures to address the economic and social impart of COVID-19” and Royal Decree 465/2020, amending Royal Decree 463/2020 of 14 March 2020 which declared the state of emergency in Spain.

Both contains 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.

The measures provided by Royal Decree-Law 8/2020 are effective for one month, notwithstanding any extension that migth be later approved by the Government. Furthermore, the impact of other central government implementing provisions and decisions and a host of autonomous regional and local legislation should also be analysed.

With regard to the payment of tax debts, Royal Decree-Law 7/2020 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'. The Royal Decree came into force last March 13th and with regard to the amount of tax debts, they cannot exceed EUR 30.000.

Secondly, this Royal Decree also 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 fiscal year 2019".

Fourthly and lastly, it 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": "Royal Decree-Law postponement".

In addition, Royal Decree-Law 8/2020 introduces the suspension of administrative procedures, terms and the statutory limitation periods.

With regard to the suspension of administrative deadlines, it provides that the various public tax administrations of the State, the Autonomous Communities (“Comunidades Autónomas”) and the Local Corporations, from March 18th, will have suspended or interrupted the terms regarding the procedures for the application of the taxes and their review through administrative channels.

Final provision one of Royal Decree-Law 8/2020 amends the revised Transfer Tax and Stamp Duty Law to declare deeds formalising the novation of mortgage loan and credit agreements executed in line with this Royal Decree-Law exempted from the progressive stamp duty fee for notarial documents.



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