This post is to clarify the recent measures the Government has taken on businesses and autonomos, affected by the recent Royal Decree, due to the Coronavirus. I hope you find this information relevant and useful to help you understand how to proceed in such a hard environment.
- TAX ON BUSINESS AND AUTONOMOS
- UNEMPLOYMENT BENEFIT AS A CONSEQUENCE OF CLOSING BUSINESS OR SEVERE DECREASE IN YOUR SALES
- TEMPORARY EMPLOYMENT REGULATION (ERTE)
TAX ON BUSINESS AND AUTONOMOS
- SPECIAL SCHEME TO DELAY PAYMENT OF TAXES
From the date the Royal Decree was published up to the 30th of May: business and autonomos will have the right to delay tax payments up to €30,000 for a 6 month period, having 3 months interests free.
This will be applicable to withholding tax on income tax, IVA and payments on corporate tax. The forms are:
- Form 303 IVA
- Form 202 Corporate Tax
- Form 130 and 131 Income Tax
- Forms 111, 115 and 123 Withholding Tax
From the 16th March:
- The Tax Office will be closed to the public
- Deadlines to appeal any tax will be suspended till the end of the quarantine
UNEMPLOYMENT BENEFIT AS A CONSEQUENCE OF CLOSING BUSINESS OR SEVERE DECREASE ON YOUR SALES
- There will be an employment benefit for those business and autonomos who were forced to close their business, according to the article 10 of the Royal Decree 463/2020
- This benefit will be 70% of the autonomo contribution which is an approximate figure of €700.
- This will be payable for one month only. However, this will be extended if the quarantine last for more than one month.
- This will be also be applicable for those who can see their sales reduced for more than 75% compared to the average of the sales made over the last previous 6 months
TEMPORARY REDUNDANCY SCHEMES (ERTE)
ERTE is a procedure to regulate the work contracts on an extraordinary health crisis such as the one we are experiencing.
Basically, it is a suspension of contracts but of a temporary nature or it can even mean a reduction in working hours.
- To companies or autonomos who had to close their business, as a consequence of the coronavirus.
- For those who can see their sales reduced for more than 75% compared to the average of the sales made over the last previous 6 months
An ERTE means:
- Your business could apply for either:
- Work contracts to be suspended
- Reduce the number of hours to work for your staff
- The business or autonomo no longer will have to pay for social security contributions on their staff or employees.
- The employees will have the right to receive an unemployment benefit regardless of the time they have been working in the past.
- Important: Business or autonomos who decides to apply for an ERTE will be obligated to keep the employees for at least 6 months after the quarantine periods expires and they get back to work
- For those who had lost their jobs, as a consequence of the coronavirus and had severe decrease on their sales (more than 40%), will have the right to apply on a suspension for their mortgage repayments. This will be applicable only on a main residence mortgage.
Also some measures to help tourist business affected by the virus.
There will be public loans for business and autonomos affected by restrictions on free movement of people and the cut off of tourist services demand, bookings cancellation, etc…
The Goverment will guarantee the loans, to be applied with the Banks and other financial instituions, to help business and autónomos obtain the necessary cash flow to keep their businesses going. For more information you will need to contact your local bank.
For more information please feel free to contact Corral&Alcaraz.
CORRAL&ALCARAZ LAW FIRM
LAWYERS, BARRISTERS & ACCOUNTANTS
+34 968 078 754