Today, we’ll explain what the late filing penalty is and precisely how we calculate them. We’ll delve into the concept of a penalty for late filing, the amount of the penalty, and the calculation process.
Content
What is a late filing penalty?
It is a tax obligation that arises when you submit a tax return or self-assessment outside the legally established deadline, regardless of whether or not you paid the tax debt.
For instance, if the filing deadline for the VAT form 303 for the third quarter of 2023 is October 20, 2023, and you submit the return on October 30, you are clearly filing it outside the legally established timeframe.
Another requirement is that you must do it without a prior administrative requirement. That means you should not have received any administrative act of verification, inspection, or regularization of the self-assessed tax debt before filing.
What is the amount of the late filing penalty?
The amount varies based on the time to submit the return or self-assessment after the deadline.
In the first 12 months, the penalty is 1%, plus an additional 1% for each complete month of delay. If it exceeds 12 months, the penalty is a fixed 15%, and they will also charge you the corresponding late payment interests.
How do we calculate those complete months?
We compute the complete months from date to date. The penalty percentage remains constant until the day of the following month, with the same ordinal number as the day the deadline ended. If that day doesn’t exist, it extends to the last day of that month.
For example, if the deadline is June 30, the calculation starts from that date for one month, ending on the equivalent date of the next month, i.e., July 30. So, if you file the return on July 30, there is no complete month, but if you file it on July 31, a complete month has passed, requiring an additional 1% to the standard 1%.
How should we calculate it?
Let’s consider three scenarios to clarify how we must calculate these percentages and complete months.
Case 1: next month
Imagine the filing deadline for the form 303 for the fourth quarter of 2023 is January 30, 2024, with a payment amount of €126.5. If you miss the January 30 deadline and file the return on March 1, 2024, the penalty will be 2% (1% fixed plus an additional 1% for the complete month).
From January 30 to February 29, there are 29 days, and even though February 30 doesn’t exist, we consider the last day of the complete month to be February 29.
Case 2: many months later during the same year
If you file the self-assessment late on September 30, passing eight months, the penalty is 8%.
Here, since the period starts on January 30 and you file on September 30, the last complete month has not finished, so it doesn’t count, and we apply the previous percentage.
Case 3: a year later
For a late submission on February 15, 2025, more than a year overdue, the penalty is a fixed 15%, plus late payment interest, making it €188.48 with corresponding interests.
We hope this article on late filing penalty has been helpful.
Related Articles
All About Spanish Digital Certificate in Less Than 5 Minutes
Do you reside in Spain or abroad?