How to avoid a tax inspection in Spain?

Reasons for tax control investigations to occur

After many years of defending our clients and providing sound guidance as tax investigation advisors, our firm has concluded that, despite elements of chance and sectoral reviews, there are specific reasons why the tax authorities might “decide to initiate a tax audit.” For example:

The tax administration of Spain has access to an extensive database that allows them to compare and analyse a significant number of deductible expenses.

This makes it relatively easy for them to detect discrepancies and initiate inspections to verify the accuracy and legitimacy of these deductions.

By using advanced data analysis techniques, the tax authorities can quickly identify any unusual or potentially erroneous claims.

This capability underscores the importance of accurate record-keeping and adherence to tax regulations with the help of professional tax investigation advisors.

• In the event of making monthly VAT refund requests.
• If an intra-community VAT number is required to allow VAT-exempt operations within the European Union, due to the high level of VAT fraud within the European Union.
• Due to the Tax Authority State Agency’s (AEAT) computer system in the event of forgetting or failing to submit an obligatory form.
• Mistakes or incoherencies between the quarterly and the annual declarations that have not been previously corrected.

Our tax compliance services are designed to help you navigate these complexities, ensuring that your deductible expenses are correctly reported and correspond to the legal requirements. 

However, if the tax inspection has occurred, then what is required of you?

• It is obligatory to grant the inspector access to the premises if they have a court order. In any case, we recommend that your lawyer or tax investigation advisors be present.
• You must cooperate as much as possible if the agents wish to use the company’s computers, especially the ones in the office.
• You must provide all the documents with tax implications, such as accounting books, computer files, auxiliary books, programs, and invoices of non-prescribed fiscal.
• It is customary to authorise the inspector to make copies of documents or hard drives, except in the case of confidential or personal data.

This is why your collaboration helps to avoid sanctions for “hindering” the work of the inspection and makes the process easier.

Legal protections during the inspection

Although you are willing to comply, you still have your rights in this matter, for instance:

• The inspection must come with written authorisation from the Tax Agency (Agencia Tributaria) of the region or fiscal domicile. Even with this authorisation, access can be denied, and a court order can be requested if necessary.
• The private domicile (your permanent legal residence or home) is inviolable according to the Spanish Constitution and therefore, a court order is required to carry out checks on the domicile if the self-employed person/company carries out its activities there.
• The inspector’s documentation and identification can be requested.
• The inspection must be done during office hours.
• Regarding the controversial topic of accessing safety deposit boxes, locked drawers, or any other container likely to store confidential documents that may violate your privacy, it is possible to object. The right to inviolability of correspondence and the right not to testify against oneself must also be respected. To carry out such searches, authorisation in the form of a court order is required.

Professional tax investigation advisors

In summary, it is crucial to approach this situation with seriousness, calmness, and professionalism. Remember that the inspector is required to carry out their duties in accordance with the law, ensuring that all forms are correctly filled out and no errors are made.

Avoiding sanctions isn’t about being overly kind, but it’s also important not to be hostile. Our team of tax investigation advisors and tax investigation specialists are here to defend you, utilizing all available legal arguments to protect your interests. If you find yourself in this situation, it’s essential to stay calm and contact us as soon as possible. We are ready to provide the support and expertise you need.