Spain will allow tax payments via direct debit from foreign bank accounts
Spain will allow tax payments via direct debit including foreign SEPA bank accounts by February 2024.
Spain will allow making tax payments via direct debit for all SEPA bank accounts, including foreign bank accounts belonging to the SEPA zone.
Before this change, it was only possible to use direct debit with certain Spanish banks. Find the official notice here, and our article explaining these rules.
Tax payments via direct debit provide major advantages to taxpayers and the tax administration. The use of this payment method has grown over the last few years in Spain. However, under current rules, direct debit is only available when the taxpayer’s bank account belongs to a bank entity cooperating with the Spanish tax authorities. This requirement imposes an important restriction when using direct debit as a payment method, especially for foreign taxpayers.
The update on the direct debit payment method will be available from 1 July 2023 for deferment and split applications of the tax debt, and from February 2024 for regular tax payments.
Following the updated direct debit method, the payments will still be processed through a cooperating bank entity, which communicates with the taxpayer’s bank entity. In consequence, all commissions and bank expenses related to the procedure will be passed on by the tax administration to the taxpayer.
How to pay Spanish VAT via direct debit from a foreign account?
To make use of this new procedure, the taxpayer will have to submit the VAT return electronically. In this process, it will be required to electronically sign a debit mandate – mandato de adeudo in Spanish. This debit mandate authorizes:
- The Spanish tax authorities to send instructions to debit the amount from the SEPA bank account communicated.
- The taxpayer’s bank entity to proceed to debit the correspondent amount.
Have a look at our Spanish VAT manual for more information on the current payment methods available in Spain.