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Guide to mutual agreement procedures

Compatibility with appeals/claims

Yes. Yes. The request for a mutual agreement procedure is independent of any administrative appeal, claim in the economic-administrative Tribunals or judicial appeal in the administrative courts that may be brought and is compatible with it.

  1. For mutual agreement procedures initiated on or after 12/10/2015, where a mutual agreement procedure takes place at the same time as a domestic appeal, the admission of the mutual agreement procedure determines that the appeal or claim in question is suspended until the mutual agreement procedure is decided However, where an appeal or claim has been brought against a serious penalty imposed in relation to the elements of the tax obligation which are the subject of the mutual agreement procedure, an exception to this general rule applies:

    • In the case of a mutual agreement procedure requested under Tax Treaty in which the existence of serious penalties (see the penalties section of this guide) excludes access to the arbitration stage of the mutual agreement procedure, where an administrative or judicial appeal is brought against such a penalty, the mutual agreement and review procedures will be conducted in parallel, but access, where applicable, to the advisory commission in the mutual agreement procedure will be prevented until a final decision has been issued in the administrative or judicial proceedings cancelling the penalty in question.

    • In the case of a mutual agreement procedure requested under the Arbitration Convention, any administrative or judicial appeal brought against serious penalties (see FAQs) would result in the suspension of the mutual agreement procedure from when the first relevant appeal was lodged until a final decision was issued regarding the penalties in the administrative or judicial proceedings.

    • In the case of a mutual agreement procedure requested under the Directive, where an administrative or judicial appeal is brought against such a penalty, the mutual agreement and review procedures will be conducted in parallel, but access, where applicable, to the advisory commission under the mutual agreement procedure will be prevented until a final decision has been issued in the administrative or judicial proceedings cancelling the penalty in question.

  2. For mutual agreement procedures initiated prior to 12/10/2015 (1) the two procedures occurring simultaneously had the following consequences:

    • If the mutual agreement procedure was decided first, acceptance by the taxpayer of the agreement reached in that procedure required the withdrawal of any domestic appeals brought.

    • If, on the other hand, the administrative appeal or economic-administrative claim was decided first and the double taxation remained for the taxpayer, the decision did not bind the competent authority and it was possible to continue with the mutual agreement procedure in order to eliminate the double taxation.

    • In the event that a judicial appeal in the administrative courts was decided first, the double taxation in that case could only be eliminated by means of a unilateral measure by the other state; that is, the Spanish competent authority could continue with the mutual agreement procedure, but it could not withdraw the adjustment, either in full or in part, if it had been confirmed in a final court judgment, since the Tax Administration cannot derogate from it.

(1) On 12/10/2015, Law 34/2015, of 21 September, entered into force, partially amending Law 58/2003, of 17 December, the General Tax Act (GTA), to introduce a new additional provision twenty-one into the GTA and new Ninth Additional Provision into Law 29/1998, of 13 July, regulating the jurisdiction of the administrative courts.(Back)

For mutual agreement procedures initiated after 12/10/2015, the administrative or judicial appeal in question will only be suspended as regards the elements of the tax obligation which are the object of the mutual agreement procedure (First Additional Provision of the Consolidated Text of the Non-Resident Income Tax Law, as worded in Article 217 of Royal Decree-Law 3/2020, and Ninth Additional Provision of the Law regulating the jurisdiction of the administrative courts, as worded in Article 218 of Royal Decree-Law 3/2020). Therefore, the administrative/judicial body will continue to conduct the administrative appeal, claim in the economic-administrative Tribunals or judicial appeal in the administrative courts as regards that part which is not affected by the mutual agreement procedure.

No, it is not possible to bring any kind of appeal against the agreement reached between competent authorities, without prejudice to the avenues of appeal available against the administrative decision or decisions issued to implement such agreements (section 5 of the First Additional Provision of the Consolidated Text of the Non-Resident Income Tax Law).