Payment of debts in installments for IRS and IRC

On January 26th, the Order No. 1090-C/2021 of the Secretary of State for Tax Affairs was published, which determines that the Tax and Customs Authority (TA) must make available to taxpayers, of its own motion, regardless of the submission of the request, the option to pay certain debts in installments, without the need to provide a guarantee.

In this sense, this possibility of payment in installments relates to personal income tax (IRS) and corporate income tax (IRC) debts equal to or less than, respectively, EUR 5 000 and EUR 10 000.

AT shall make available to taxpayers the option of payment in instalments whenever the following cumulative conditions are met:

  1. The debt is at the stage of voluntary collection;
  2. The taxpayer is not a debtor of any taxes administered by AT;
  3. The debt is due up to the date of entry into force of the law that will approve the availability to taxpayers of the installment payment option.

For this purpose, it is important to understand that the installment plan is created by the AT and that the number of installments is defined by table, as explained in the Order no. 1090-C/2021. The payment of the first installment occurs until the end of the month following the creation of the plan by the AT and the payment of the following installments until the end of the corresponding month.

The AT notifies taxpayers of the installment plans and the document for payment of each installment (payment reference) must be obtained through the Finance Online Portal.

However, it should be noted that failure to pay any of the installments means that the following ones are due immediately, thus setting up a tax execution process for the amount due.

The order in question also regulates the possibility of creating installment plans, in terms similar to those described above, for debts in tax execution, both for individuals and legal persons.

These support measures arise in the context of the public health emergency of international scope, which brought the approval of several exceptional measures to make fiscal obligations more flexible and to support families and companies, to mitigate the effects of the COVID-19 pandemic.

The content of this information does not constitute any specific legal advice; the latter can only be given when faced with a specific case. Please contact us for any further clarification or information deemed necessary in what concerns the application of the law.