When is a credit considered as impossible to recover or to charge in Spain?

Litigation lawyer in Marbella

Hopefully it will never come to this, but it is possible that at some stage in your professional life, you must face credits that are impossible to charge: therefore, we have some valuable information for you today.

 
Before you try to tackle the subject, we need to clarify in which situation a credit is considered as unrecoverable, or, in other words, impossible to charge.

 
When is a credit considered as impossible to recover or to charge in Spain?

Meet some of the following conditions:

1-One full year has passed since the corresponding tax has been paid over that sum, and the sum of the credit has not been paid totally or partially.

2- The non-payment has been duly reflected in the registry book required for such taxes.

3-  If the candidate of said operation at issue acts as a businessman or professional, or in its default, the tax base (VAT not included) is always higher than 300€.

4- The taxpayer of the operation has claimed the sum of the credit by legal proceedings or it has been required by a notary in Spain.

The modification must be done within a maximum term of three months following the termination of one year (referenced above), and such must be duly communicated to the Spanish Tax Office in the terms set out in the legislation.

Once the corresponding reduction of the tax base has been carried out, this may not be changed again upwards, even if the taxpayer would have obtained the collection of the credit, totally or partially, provided that the addressee does not act as a professional or businessman.

Should you have any doubt about the collection of a credit in Spain, whether it is recoverable, unrecoverable or any other issue, we at Welex have a team of lawyers, legal advisors, and expert economists specializing in the matter who can study your case, advise you in a personalized way, and always act in your best interest. Do not hesitate to contact our litigation lawyers in Spain.