Where will the Spanish tax authorities focus in 2023?

The Directorate General of the Spanish Tax Agency (AEAT) published the general guidelines of the General Tax and Customs Control Plan for 2023 in the Official State Gazette (BOE). The plan sets out the areas and players the tax authorities will scrutinize this year

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High-net-worth taxpayers

Once again, this type of taxpayer will be a focus of the agency’s investigations. The aim is to detect and correct irregular conduct. To that end, tools will be implemented to obtain information on real estate and companies from the General Council of Notaries (Consejo General del Notariado).

Taxpayers who regularize their tax position

Taxpayers who regularize their tax position should be alert, as the Tax Agency has announced repeated checks.

Sham non-residents

Individuals who reside in Spain and reduce their tax bill through other low-tax territories will be scrutinized for incorrectly paying tax under Non-Resident Income Tax (IRNR) solely on the income obtained or generated in Spain.

Artists and athletes

Non-resident artists and athletes who perform in Spain will remain a focus of the Tax Agency, which will monitor the income they obtain.

Payers and recipients of cryptocurrencies

The tax authorities announced greater control over payments received in virtual currencies through entities or applications located abroad. Individuals or entities that have invested in cryptocurrencies will also be monitored.

Taxpayers claiming VAT refunds

Taxpayers who have been entered in the registers of intra-Community operators and of monthly VAT (IVA) refunds will have to be able to show that they meet the requirements to remain on them, as the tax authorities announced that they will step up checks in this area.

Holders of point-of-sale terminals

This will affect terminals that could be used to evade attachment actions. In addition, specific actions concerning point-of-sale terminals located abroad will be intensified. Likewise, efforts to locate new assets liable to attachment will be reinforced, with a particular focus on crypto-assets and virtual currencies.

Foundations

They are among the players the tax authorities will scrutinize, and they must correctly apply the special tax regime for non-profit entities, especially when they carry out business activities.

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Concealment of business or professional activities

Coordinated actions will be reinforced, with a focus on taxpayers who:

• Do not accept payments through banking channels;

• Obtain their income from supplies of goods or services made directly to the final consumer. This is because the risks and the lack of control over payment methods increase; or

• Show third-party signs of wealth, assets, or profitability, or financial information, that are incoherent or inconsistent with the income declared.

Abusive use of companies

Likewise, actions will be planned to prevent the abusive use of companies with the main purpose of channeling income or unduly diverting individuals’ personal expenses, thereby improperly reducing the applicable tax rates.

Building on previous actions, the tax authorities will monitor the false allocation to business activity of luxury assets (aircraft, vessels, or high-end cars) or of services related to the luxury sector by legal entities whose activity is not linked to the exploitation or leasing of such assets.

Finally, control actions will be carried out on taxpayers who report an irregular or anomalous evolution in the amount of their inventories that is inconsistent with their declared activity and indicative of possible hidden sales.

E-commerce

In this area, the Tax Agency will take a cooperative approach to determine the most appropriate way to access the necessary information held by e-commerce platforms. This will affect both residents and non-residents in Spain. Efforts will be made to ensure the full tax identification of taxpayers (obligados tributarios) engaged in e-commerce who, although not domiciled in Spain, carry out the VAT taxable event through their sales to final consumers located in Spain.

Behavioral insights

This involves visits to certain business sectors and the issuing of warning letters to taxpayers with a lower turnover who present certain indicators of non-compliance risk, where it is also observed that these parameters have persisted continuously over recent tax years.

Visits

Visits will continue to be made to premises where goods subject to customs surveillance are located. The aim: to verify the correct use of the corresponding authorizations.

Actions will be carried out aimed at neutralizing organized crime activities, which are often cross-border.