Royal Decree-Law 3/2016 measures on deferrals

Royal Decree-Law 3/2016, of 2 December, eliminated the possibility of granting deferrals or instalments on certain tax debts, including those arising from the payment in instalments of corporate income tax and those arising from taxes which, like VAT, must be legally charged, unless it is justified that the charges charged have not actually been paid.

Processing of deferrals after Royal Decree-Law 3/2016

Applications for deferment or payment by instalments of debts affected by this measure will be rejected, while other applications will be processed according to their amount, in accordance with the established procedure, which has not been modified by the Royal Decree Law. Thus, applications for deferment or payment by instalments that refer to debts for a total amount equal to or less than 30,000 euros will not need to provide guarantees, and will be processed through an automated process. Applications for a higher overall amount will need to provide adequate guarantees and will be processed through an ordinary, non-automated process. 30,000 in October 2015.

Impact of the measure on the self-employed

As regards the self-employed, the measure relating to the payment of corporate income tax in instalments does not affect them, since they are subject to personal income tax. The measure on output VAT does affect them, although they will be able to continue requesting deferrals and instalments of VAT if they can prove that they have not received the output payments. The main change for the self-employed will therefore be that they will have to prove that they have not charged the output VAT, particularly for those applications that exceed the guarantee exemption limit.

Consequently, the self-employed may request the postponement, whatever the amount, of their Personal income tax and VAT in the following circumstances, depending on the overall amount of the debt:

  • If the requests relate to a debt whose overall amount is equal to or less than 30,000 euros, deferrals may be granted, without guarantee, up to a maximum of 12 monthly instalments, unless the obligor has requested a lower number of instalments, in which case the requested instalments will be granted. The frequency of payments shall, in any case, be monthly. They are processed through an automated resolution mechanism.
  • If the requests relate to a debt whose overall amount exceeds 30,000 euros, deferrals may be granted, depending on the type of guarantee provided by the debtor, and for a maximum of 36 monthly instalments, unless the obligor has requested a lower number of instalments, in which case the instalments requested will be granted. If the debts are for VAT, it will also be necessary to prove that the VAT payments charged have not been paid.