Tax Liability: Accrual, Prepayments, and Inspection Procedures

Accrual

Article 21 of the General Tax Law (LGT) defines accrual as the moment which determines the event performed that produces the birth of the principal tax liability. To narrow down the moment in time that this occurs, we must differentiate between tax accrual of taxable periodic taxes and instant taxes. In the first case, the legislature must enter narrow time periods. Fiction serves to establish that the moment the taxable event occurs, usually periods of months or years. The rule in instant charges will be that in force when the taxable event occurs. In contrast to periodic taxes, and unless otherwise provided herein, the applicable standard for reasons of legal certainty will be in force at the time of commencement of the tax period.

Prepayments (Article 23)

Payments on account, in accordance with Article 23 of the LGT, require a taxpayer to satisfy a tax amount to the Administration. The party obligated to make installment payments is either the retainer or the party obligated to make payments on account. This tax liability is autonomous with respect to the principal tax liability.

Entities Required to Retain or Make Payments on Account

In general, the following are required to retain or make payments on account, as income is subject to fulfilling this obligation:

• Legal persons and other entities, including communities of owners and entities subject to income attribution.
• Taxpayers carrying out economic activities as they receive income in the exercise of their activities.
• Individuals, legal entities, and other non-resident entities operating in Spanish territory through a permanent establishment, or without one in certain cases.

Advance payment has been configured as separate. It makes sense in income tax. If the employer does not refer to doing it as income tax withheld, the Treasury may take action against them.

Inspection Procedure

This procedure involves the verification of reported data and the checking of values. Article 141 of the LGT contains other features that are unique to inspections, such as research for the discovery of unknown facts and information activities related to the application of taxes. For the development of these activities, the inspection has a number of powers and limits. As law enforcement officers, inspection officers are considered law enforcement officers. They may request information from people about their own operations or from persons other than banks and building societies. Inspection bodies will have to raise the requirement for carriers. They may also review documentation and be present on certain premises, which may be carried out without prior notice at the offices or facilities concerned. The boundaries are the subjugation to the national inspection and specific skills that must be performed by persons belonging to that body.

The inspection procedure is initiated ex officio. This may be served on the obligated party or through direct offices customization. The public complaint itself does not initiate the procedure, but a check is made, and then the Administration decides whether or not to proceed. The development is done through multiple untaxed administrative activities. The processing must include the audience's interest. They may also submit observations and produce documents before the hearing process. Termination is effected with two kinds of different acts, such as inspection reports. They constitute an act of procedure and the proposed settlement. An agreement can be reached in minutes, records, and compliance records of dissent. In this case, submissions may be filed within 15 days from the date he refused to sign, but no appeal. However, there may be proceedings in which the inspector did not discover or declare debt, so that it cannot be accompanied by regularization or a proposed settlement.

The proceedings end with the liquidation proceedings as a decisional act of the inspection procedure. These settlements may be appealed, as opposed to inspection reports, because they are decisions that end the administrative process.