New simplified method for corrective VAT returns in Spain

New simplified method for corrective VAT returns in Spain when as a result of the correction, there is no additional input VAT to pay.

The Spanish administration has introduced a new mechanism for corrective VAT returns aimed at simplifying the process of rectifying errors in tax declarations. This innovative approach will replace the prior administrative procedures, offering taxpayers a more intuitive and streamlined method to correct inaccuracies.

At the moment, the measure needs to be confirmed in the implementing regulation for VAT.

What will be the Change for Spanish Corrective VAT Returns?

The figure of corrective VAT returns, in Spanish declaraciones rectificativas, empowers taxpayers to rectify, complete, or modify their previously submitted VAT returns, always in the same way and regardless of its outcome.

At the moment, whenever you need to correct a VAT return already submitted in Spain, you should follow the corresponding method depending on what you need to correct:

  • If the VAT position is increased after the correction, then you need to file a new VAT return replacing all data of the previous return needs to be submitted. This method is known as "Declaración complementaria".
  • If the VAT position is decreased or does not change, then you would need to initiate an administrative procedure, sending a letter to the tax authorities explaining what needs to be corrected and requesting the refund of the additional VAT paid.

The latter method will be replaced by the new corrective VAT return system. Therefore, where the correction is in favor of the taxpayer -for example, a reduction in the final VAT position-, instead of initiating a complex administrative procedure to correct the return, the taxpayer will be able to simply prepare and submit a new VAT return with corrected data, using the same form employed for the original submission. The correction will be valid as from the submission deadline, without the need to open a new procedure, which will save time solving those mistakes.

Have a look at our VAT manual for more information about the current methods for correcting VAT returns in Spain.

Once the new method comes into force, both methods will be equivalent, although we will continue to refer to declaraciones complementarias – first method-, and declaraciones rectificativas, the second new method.

Corrective VAT returns in Spain can be submitted both within and outside the reporting period.

This method aims to simplify the processes both for the tax administration and for taxpayers. Nevertheless, some stakeholders, like the Spanish association of tax advisors (AEDAF), warn about the possible loss of guarantees for the taxpayers. Considering that the VAT refunds will be automatically processed upon the submission of the corrective VAT return, it is more likely that the tax administration carries out verification procedures afterward and, in case of not agreeing with the taxpayer’s calculations, penalties are applied.

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