Reductions on penalties

Reduction for compliance

Firstly, if after being subject to a tax audit you receive a tax assessment from the Tax Office and also get penalized for committing an offense that causes an economic loss to the Tax Office (failure to pay, obtaining an undue refund...), know that you will be entitled to a 30% reduction on said penalty . To do so, it is necessary to agree to the tax assessment and not appeal against it .

Reduction for early payment  

On the other hand, also know that for all penalties imposed by the Tax Office – regardless of whether the offense committed causes an economic loss to it or not – you are entitled to an additional 40% reduction for early payment, which is compatible with the previous 30% reduction. To do so, it is necessary:

• Not to appeal either the initial tax assessment or the penalty (if you only appeal the penalty, you will lose the 40% reduction but will keep the 30% one).
• To pay the penalty within the deadline granted by the Tax Office or to defer the payment by providing a guarantee such as a bond or surety and making all payments of the deferral on time.

They are compatible

If you meet the requirements to enjoy both reductions, know that both are compatible. In that case, the total applicable reduction must be calculated cumulatively:

• Firstly, the reduction for compliance is calculated on the amount of the initial penalty.
• Next, the reduction for early payment is quantified on the resulting net amount.

Thus, for example, if your company has failed to pay 20,000 euros and you are imposed a penalty of 10,000 euros (50%):

 

Concept	Amount
Initial penalty	10,000
Compliance reduction 30%	-3,000
Previous penalty	7,000
Early payment reduction 40%	2,800
Final penalty to pay	4,200 (1)

(1) In this case, the total effective reduction ends up being 58%.

If the Tax Office initiates a sanctioning procedure against your company or any other tax procedure, contact us. Our professionals will defend your interests and ensure that you are not taxed more than necessary.