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Spain

Paul Hastings in collaboration withGarrigues
Liquidity Measures
Tax Reliefs
Insolvency Matters

Liquidity Measures

Funding for credit institutions

Government Measure

Government will grant up to €100b in guarantees for funding provided by credit institutions.

Net indebtedness limit for the Spanish Official Credit Institute (ICO) raised by €10b to increase ICO facilities providing funding to companies and self-employed.

The guarantee will cover 80% of new financing operations and renewals for self-employed and SMEs.1

For all other companies, the guarantee will cover 70% in the event of new loan operations and 60% for renewals.

There is no limit to the amount of guarantee per beneficiary, subject to EUs state aid rules.

1Companies with (i) less than 250 employees; and (ii) an annual turnover that does not exceed €50m or with an annual balance sheetthat does not exceed €43m qualify as an SME.

 
Eligibility

The self-employed, SMEs, and companies in all sectors of activity that:

  • have their registered office in Spain;
  • have been affected by the economic effects of COVID-19; and
  • require funding to meet their needs arising from managing their invoices, working capital (cash), financial or tax obligations, or other liquidity needs.

For more information about eligibility, please see here and here.

 
Supervising Authority

The Ministry of Economic Affairs and Digital Transformation and the Council of Ministers.

The financing will be available through any of the credit institutions, financial credit establishments, payment institutions, or e-money institutions that have signed the corresponding collaboration agreements with the ICO.

Applications to be made directly with the above mentioned institutions.

Legislation available here.

 
Availability

From 18 March 2020 to 30 March 2020

Increasing of the CESCE insurance cover facility

Government Measure

The Spanish Export Credit Agency (CESCE) has been authorized to provide insurance cover amounting up to €2b for the working capital credit facilities needed by SMEs (excluding micro-companies being those with less than 10 employees and with an annual turnover or annual balance sheet that does not exceed €2m) and larger (non-listed) companies.

There is no requirement that the use of the funds be linked to the performance of export contracts and should respond to new financing needs and not to pre-crisis situations. The percentage of credit risk cover shall not exceed 80%. The insurance premiums may vary whether the beneficiary is an SME or a non-SME, in accordance with the di minimis EU regulations.

 
Eligibility

Eligibility: working capital credits for export companies will be eligible, without the need for a direct relationship with one or more international contracts, provided that they respond to new financing needs and not to situations prior to the current COVID-19 crisis.

Beneficiary: SMEs and bigger non-listed companies when:

  • they are internationalized companies or in the process of internationalization;
  • they face a liquidity problem or lack of access to financing as a result of the impact of the COVID-19 crisis on their economic activity; and
  • they are not insolvent or in pre-insolvency state.

For more information about eligibility, please see here and here.

 
Supervising Authority

The Spanish Export Credit Agency (CESCE).

Legislation available here.

 
Availability

From 18 March 2020.

R&D&I

Government Measure

The sums in the Fund for “Red Cervera” Technical Provisions and R&D&I projects are allowed to be used to cover any risks that the Centre for Technological and Industrial Development (CDTI) may incur by providing loans to finance R&D&I projects of small and medium enterprises, and of mid-cap companies.

 
Eligibility

SMEs and mid-cap companies operating in ay sector, with registered office in Spain, which are developing a national R&D&I project supported by the Centre for Technological and Industrial Development.

For more information about eligibility, please see here.

 
Supervising Authority

Centre for Technological and Industrial Development (CDTI).

Applications for the scheme can made by companies here.

Legislation available here.

 
Availability

From 11 March 2020

Tax Reliefs

Tax debts deferrals

Government Measure

Certain tax payments will be deferred for a term of six months in which no interest will accrue for the first three months of deferral.

Tax payments under the scope of this deferral include those due, by assessment or self- assessment, between 13 March 2020 and 30 May 2020 without the need to provide a guarantee, provided that the amount of taxes due do not exceed €30k.

The deferral may be extended to customs and tax debts relating to customs declarations.

 
Eligibility

It applies to all self-employed persons and small and medium enterprises registered in Spain whose turnover for the year 2019 does not exceed €6,010,121.04.

A cap of €30k is set for tax debts that may be deferred on these special terms.

 
Supervising Authority

Spanish Tax Agency (AEAT)

Applications for the deferral of the debt can be made here.

The taxpayer shall select the special COVID-19 procedure established in RDL 7-2020 with no guarantees.

Legislation available here.

 
Availability

From 13 March 2020 to 30 May 2020

Extension of the filing and payment deadline for certain tax returns andself-assessments

Government Measure

This extension benefits small and medium-sized companies and self-employed, and relates to returns to be filed between 15 April 2020 and 20 May 2020.

 
Eligibility

It applies to taxpayers that had revenues of €600k or lower in 2019. For taxpayers with public authority status, including the social security authorities, their latest approved annual budget cannot go above €600k.

 
Supervising Authority

AEAT

Legislation available here.

 
Availability

From 15 April 2020 to 20 May 2020.

Suspension of certain tax term periods

Government Measure

Terms and deadlines for all the procedures in progress against the AEAT have been suspended during the state of emergency. The authorities are allowed, however, to carry on with ordinary conduct of tax procedures, to order and carry out any steps they consider absolutely necessary and to make notifications, demands, requests for information or grant terms for audit of files and comments. In this case, the terms for fulfilment of these steps by the taxpayer have been extended until 30 April 2020 or 20 May 2020, depending on the case concerned.

Deadlines for filing tax returns and paying regular taxes (such as withholding taxes, prepayments, VAT, etc.) have not been extended, unless the deferral explained above is applicable.

 
Eligibility

It applies to all businesses registered in Spain and this suspension is automatic.

 
Supervising Authority

AEAT

Legislation available here.

 
Availability

Until 30 April 2020 or 20 May 2020, depending on the specific case.

Exemption from contributions in the case of ERTEs due to force majeure

Eligibility

There is a full exemption from the employer’s share of social security contributions for companies with fewer than 50 workers and a 75% exemption for companies with 50 or more workers.

 
Supervising Authority

Ministry of Employment.

Legislation available here.

 
Availability

From 28 March 2020

Interim exemption in relation to transfer and stamp tax for mortgage transactions

Eligibility

Deeds of contractual novation of loans and mortgage credits that take place under the scope of Royal Decree Law 8/2020, of 17 March 2020, will be exempt from the gradual quota from the ad valorem stamp tax charge on notarized documents.

 
Supervising Authority

AEAT

Legislation available here.

 
Availability

From 18 March 2020

VAT and custom duties exemption

Government Measure

For imports of any goods necessary for medical treatment of individuals affected by COVID-19 and for avoiding the spread of viruses. In addition, a 0% VAT rate is established temporarily (until 31 July 2020) for domestic supplies, intra EU acquisitions or imports of the goods listed in the annex of the Royal Decree-Law 15/2020, for which the customers are public entities, non-profits and hospitals.

 
Eligibility

Public entities or authorized private entities with charitable or philanthropic purposes.

 
Supervising Authority

Customs and Excise Department

Legislation available here and here.

 
Availability

From 23 March 2020

Insolvency Matters

Suspension of assessment of VAT and of excise taxes on electricity and on hydrocarbons on the bills for electricity, natural gas, and oil products

Government Measure

Exemption from any obligation to assess and pay VAT and, where relevant, the excise tax on electricity and the excise tax on hydrocarbons relating to bills with suspended payment, until the customer has paid them in full, or six months has run from the end of the state of emergency.

 
Eligibility

Electricity and natural gas retailers and distributors of manufactured gases and piped liquefied gases.

 
Supervising Authority

AEAT

Legislation available here.

 
Availability

From 1 April 2020.

Measures in relation to the CIT prepayments

Government Measure

Taxpayers with revenues of €600k or lower in 2019 will be entitled to calculate their CIT prepayments using the “tax base method” before 20 May 2020 (deadline for filing the April prepayment for these taxpayers, due to the extension of the period approved by Royal Decree-Law 14/2020).

 
Eligibility

Other taxpayers with net revenues of €6,000,000 or lower in FY19 will be also entitled to calculate their following prepayments (October and December, 2020) using the “tax base method”. This measure does not apply to any tax group taxed under the special consolidated tax regime for CIT purposes.

 
Supervising Authority

AEAT

Legislation available here.

 
Availability

Before 20 May 2020

Tax credits for donations

Government Measure

Taking effect from 1 January 2020, a higher tax credit is available for donations made by individuals and by nonresident income taxpayers operating in Spain without a permanent establishment.

 
Supervising Authority

AEAT

 
Availability

From 1 January 2020

Measures approved by Spanish regional and local government authorities

Government Measure

All measures described above have been adopted by the Spanish Government and apply in general to all Spanish Territory. However, there are state taxes managed by the regional governments, and also regional and local taxes.

 
Eligibility

Since the declaration of the state of emergency, regional and local authorities have been adopting measures for helping companies and individuals during this period. Even if those measures are not homogeneous and they may change from time to time, generally, the regional and local governments are deferring tax declarations and payments to a further delay than the Spanish government as regards state taxes.

 
Supervising Authority

Each regional and local government

 
Availability

It depends on each regional and local government

Suspension of all procedural terms and authorized judicial proceedings

Government Measure

All procedural terms for all kinds of courts have been suspended, which includes terms before commercial courts, which are the courts that specialize, among others, in insolvency matters and form part of the civil jurisdiction. These terms will resume when the state of emergency ends. However, this suspension does not prevent the courts from ordering the performance of any judicial steps that are necessary to prevent irreparable damage to the legitimate rights and interests of the parties to the proceeding.

New insolvency proceedings are also subject to the restriction of new submissions indicated above.

 
Supervising Authority

Ministry of Justice (Civil jurisdiction).

Legislation available here.

 
Availability

From 14 March 2020

The duty to request a voluntary insolvency order has been disabled until 31 December 2020

Government Measure

No petitions for necessary insolvency orders filed by creditors against the debtor will be admitted for consideration.

 
Eligibility

Directors should not lower their guard, since this measure does not mean that they cannot become liable for causing or aggravating insolvency for the company.

For further information about this matter, please here.

 
Supervising Authority

Ministry of Justice (Civil jurisdiction).

Legislation available here.

 
Availability

From 28 April 2020

New Spanish Revised Insolvency Law

Government Measure

The Official Spanish State Gazette (BOE) has published a new Spanish Revised Insolvency Law on 7 May 2020, introducing regulation that departs from the existing provisions on restructurings and insolvencies.

 
Eligibility

For further details please visit here.

 
Supervising Authority

Ministry of Presidency

Legislation available here.

 
Availability

1 September 2020