Find out what are the most common penalties and overcharges that you will get if you forget to submit a tax form or miss a payment.
Late payment of Social Security.
Social Security contributions need to be paid by the business or the sole trader at the end of each month, normally on the last working day. If for any reason it is not paid you will get an overcharge of 10% if you manage to pay it during the following month. If not, the overcharge will be of 20%.
The Standard autonomo fee of 283€ becomes 340€.! However it is even more painful if you are benefiting from a reduced payment since you will lose the reduction that month and pay the 330€!
To pay the autonomo fee once we realised that it is not paid we can go to the social security office to ask for a pay-slip.
In some rare occasions the fault is of social security direct debit that did not went through. If you can prove, showing you bank statement, that there was sufficient funds in the account at the end of the month, you may be able to win the case and your penalty may be withdrawn.
Of course, if it was an internal problem of the bank the Social Security will not take any responsibility.
Late presentation of the quarterly form.
Sole traders and companies have the obligation to report a balance of the IVA and the result of the quarter etc. even if the result is nil or ” sin actividad” (no trading). Failing to submit a quarterly report brings penalties.
We will consider two main cases:
1. Nil result (with no payment obligation.)
If the form is presented late without being requested by the authorities you will receive a 150€ fine. (75€ if paid promptly)
If the form is presented after a formal request by the authorities, 200€.
2. With a positive result to pay.
In this case, the overcharge is a percentage of the resulting amount. (This overcharge does not have to be added to the amount at the time of the payment, but it will come in the way of a pay-slip some weeks after they detect the late payment.)
5% – for payments made within 3 months after the deadline
10%- for payments between 3 months + 1 day and 6months after the deadline
15%- between 6months+1day and 12 months
20%- after one year. In these cases, further interest will also be applied…
Late presentation of annual informative reports.
The late presentation of informative annual reports such as Modelos 180,190, 347, 349,390… incur a penalty of 20€ for each missing piece of information that should have been included with a minimum of 300€ and a maximum of 20,000€.
For penalties that are paid within the voluntary period, normally within 20 days after receipt, there is a 25% reduction.
When revisions result in a change of the tax amount
If after a tax revision the inspector modifies the tax result, it will apply a fine of 50% of the balance between the declared tax result and the newly obtained one.
If you are in agreement with the new result – the penalty/fine is reduced to 30% rather than 50%.
If it is paid within the period given there will be applied further reductions of 25% (of the already reduced amount).
After a revision, you find that they removed some expenses from your books. This results in a tax liability of 500€ more than you actually declared.
In this case, you will have to pay:
1. Undeclared tax : 500€
2. Penalties and reductions:
50% of 500€ = 250€
Reduction due to conformity: 30% of 250€ = 75€ Amount to pay: 175€
Reduction due to prompt payment : 25% of 175€ =43,75€.
The reduced penalty under this assumptions would be: 131,25€
When fines are contested and the revision tribunal rules against the taxpayer, the reductions are removed.