ICONOS FINALES-TRAZADOS

Surcharges for enforcement

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If your company does not submit a tax settlement within the established deadline, it will face an enforcement surcharge. How is this surcharge calculated?

Surcharges for enforcement
If your company allows the voluntary payment period of a self-assessment submitted without payment or a tax settlement to elapse, the so-called "enforcement period" begins. This means that the tax authority activates its collection machinery –through the enforcement procedure– with the aim of collecting, which may even lead to the seizure of assets. In order to initiate this procedure, it is necessary for the tax authority to first notify you of the enforcement order, requiring payment of the amount owed.
In this order, the tax authority will also require a surcharge that will depend on when the debt is settled:
  • The surcharge will be 10% if your company pays the debt once the enforcement order is notified and within the new deadline granted for payment.
  • The surcharge will be 20%, plus late payment interest, if payment is not made within that new deadline granted.
The deadline that the tax authority grants in these cases to make the payment and enjoy a surcharge of only 10% is short:
  • If your company receives the order between the 1st and the 15th of a specific month, the deadline will end on the 20th of that same month.
  • If it is received between the 16th and the last day of the month, you will have until the 5th of the following month.
However, there is a possibility that your company only has to pay a surcharge of 5%: this will occur if the total outstanding debt is paid before you are notified of the enforcement order. . In that case, once the entire debt is paid, the tax authority will send your company the payment letter with the reduced surcharge.
Please note that the surcharges of 5%, 10%, and 20% are incompatible with each other and are calculated on the entire debt not paid during the voluntary period. Therefore, if you decide to pay the debt before receiving the enforcement order (so that only the 5% surcharge is applied) or within the deadline of the order (so that the 10% is applied), pay the entire debt. If you only make a partial payment, it will not help reduce the surcharge.
In case you cannot pay the entire debt, it is best to request a deferral (if you request it before the tax authority sends you the enforcement order, they will only require the 5% surcharge). Debts in the enforcement period can be deferred before the tax authority has notified the agreement for the disposal of the seized assets.
 
If your company has to face a tax settlement and does not have sufficient cash flow, consult us. We will analyze the options available to defer payment and thus avoid surcharges.

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