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Report 2020

4.2.1. Control over internal taxes

The control actions on internal taxes encompass the following actions, excluding those relating to special taxes, environmental taxes and those that fall on foreign trade:

  • Inspection actions on internal taxes.
  • Management control over the generality of taxpayers and control over taxpayers included in the module taxation system.
  • Managerial control over large companies.

The purpose of inspection control actions is to detect and regularize the most complex non-compliance and prosecute the most sophisticated forms of fraud. Their selective nature makes them fall on taxpayers who present a higher tax risk.

These actions are carried out by the bodies of the Special Delegations and by the bodies of the Central Delegation of Large Taxpayers that are entrusted with the development of the tax inspection.

Its implementation has a large investigative component and requires, in general, an exhaustive review of the tax situation of the taxpayer subject to inspection action, for which the bodies that carry them out are equipped with the broadest powers that the regulations attribute to the Tax administration.

The purpose of management control is to detect and correct less complex errors and non-compliance and is characterized by the fact that it is aimed at the generality of taxpayers on the occasion of annual campaigns, with strong support from the available information and the computer system that analyzes it. It refers to individually considered obligations, is based on formal and documentary controls, without review of the taxpayer's commercial accounting, and is normally carried out from the offices themselves.

Management control is carried out by the corresponding bodies of the Special Delegations, the Central Delegation of Large Taxpayers and, where appropriate, the National Tax Management Office.

Along with these controls, the management actions on large companies are computed, which are those whose volume of operations exceeds the figure of 6.01 million euros during the immediately preceding calendar year, calculated in accordance with article 121 of Law 37/1992. , of December 28, of the Value Added Tax, which determines that they have specific tax obligations that are different from the rest of the taxpayers.

These actions are carried out by the bodies of the Financial and Tax Inspection area, through the Large Company Management Units (UGGES) within the scope of the Special Delegations, as well as by the Management Units and the Tax Control Unit and Customs, integrated respectively into the Tax Assistance and Services Unit and the Tax and Customs Control Unit of the Central Delegation of Large Taxpayers.

The managerial control actions on large companies are, among others, the verification of the refunds provided for in the tax regulations and the performance of data verification and limited verification actions that may give rise to subsequent settlements.

Along with the previous verification actions, investigative and auxiliary actions are also included in this indicator.

In 2020, more than 1.62 million internal tax control actions have been carried out, of which the vast majority have been verification actions, 1.56 million. Of this global number of verifications, 29,567 nominal actions were directed at large companies, multinationals and tax groups, assets of natural persons, corporate abuses and the underground economy, these types of actions consuming a high number of resources, also characterized by their high qualification.

The slight decrease in the number of actions compared to 2019 is mainly due to the difficulty of carrying out in-person visits to taxpayers as a result of the pandemic, but, in any case, there is a maintenance of the actions of the Tax Agency this year 2020 in which the Agency's activity has been affected by exceptional circumstances caused by the health situation.

Inspection activities on domestic tax contributions

These activities comprise all of those carried out by the bodies of the Financial and Tax Inspection division of the Special Delegations and of the Central Delegation of Large Taxpayers, in exercising the administrative functions attributed to the tax inspection by article 141 of the General Taxation Act.

These actions may be verification, investigation or auxiliary in nature.

The total amount of debt settled in 2020 amounted to 3,423 million euros. This amount includes both debt instructed and settled in the fiscal year 2020 itself, as well as debt instructed in previous years and settled in 2020, not counting, however, the debt instructed in the fiscal year, but contained in minutes that have not been confirmed to date. the end of the 2020 financial year.

Among the actions carried out by the Inspection in the field of internal tax control, the following stand out:

  • Control of large assets: Since its creation in 2018, the Central Coordination Unit for the Control of Relevant Assets (UCCCPR) of the National Fraud Investigation Office, has focused its efforts on the preparation of a complete “census” of taxpayers with high economic capacity, the delimitation of their specific tax risks or frauds, the study and development of the appropriate investigation and selection mechanisms to detect said risks in specific taxpayers and the promotion of initiatives regarding obtaining and/or effective management of relevant information. During 2020, a significant effort has been made in terms of actions to verify tax contingencies associated with taxpayers who appear as holders of relevant assets. This type of inspection verifications has resulted in settled debts amounting to 437 million euros in 742 files. These figures are complemented by the analysis of the tax bases and fees declared in personal income tax by taxpayers with relevant assets.

  • Actions on the underground economy, focused on:

    • Discovery of hidden sales, with more than 2,100 actions in which it has been possible to reveal the existence of sales that the taxpayer had hidden from the Tax Administration.
    • Entries and records with Computer Audit Units, which, in addition to facilitating the discovery of hidden income through the analysis of dual-use software used in the management and accounting of economic activities, are extremely efficient from the point of view of obtaining evidence and the duration of the checks. It should be noted that the participation of these specialized Units, in addition to facilitating the discovery of hidden income through the analysis of dual-use software used in the management and accounting of economic activities, is extremely efficient from the point of view of obtaining evidence and of the duration of the checks.
    • Coordinated actions, consisting of the simultaneous initiation of verification and investigation actions, through appearance and with the participation of the Computer Audit Units, and which pursue not only the discovery of hidden sales in the inspected tax obligors, but also promote compliance voluntary by transmitting a message to the group of businessmen in the sector so that they redirect their tax behavior.

  • Actions to exploit international information from DAC1, CRS, DAC2 and FATCA. Specifically, in 2020, ONIF has automatically exchanged information with other countries and jurisdictions related to the following categories:

    • Information on income from work, income from directors, income from pensions, income from life insurance products, as well as ownership and real estate income (OECD and DAC1 income)
    • Information on financial accounts abroad (CRS, FATCA and DAC2)
    • Country-by-country reports (CBC and DAC4)
    • Information on prior tax consultations and agreements with cross-border effects and on transfer pricing (DAC3)
    • Information has begun to be received on mechanisms with cross-border tax planning effects (DAC6)

  • Actions on small businesses through specialized procedures based on the size of the entities and the characteristics of their tax risks, by promoting abbreviated verifications.

International taxation

Throughout 2020, the National Office of International Taxation (ONFI) has contributed its important role in the fight against international tax fraud and avoidance. The Office's activity has focused both on inspection actions, completing 263 actions, and on the relevant assistance of its officials to working groups in international organizations, fundamental in matters of international taxation, as well as participation in action planning functions. inspector

The aforementioned inspection actions include support and collaboration in inspection procedures, the instruction of prior agreements for the valuation of related-party transactions (APA) and the negotiation in mutual agreement procedures regarding direct taxation, among others.

ONFI carries out support and collaboration actions in inspection procedures, focused on complex issues regarding international taxation. This activity is particularly relevant in the area of inspections of the Central Office of High-Income Taxpayers. In 2020, ONFI collaborated in 179 inspection checks, of which 82 have been completed, assuming adjustments to the tax base, estimated at around 3,076 million euros. In the previous year, 142 inspection actions were participated in, of which 74 were completed, with a total amount of adjustments to the tax base of more than 1,800 million euros.

In relation to APAs (prior agreements for the valuation of related-party transactions), the ONFI's actions seek, through these prior agreements on transfer pricing, to reduce litigation and improve the legal security of the taxpayer, guaranteeing appropriate collection. with what is required by law. In 2020, ONFI participated in the management of 203 files. Of that total, 71 were finalized, compared to 66 in 2019, 54 were estimated compared to 25 in 2019, 8 were rejected, in 7 cases the applicants withdrew and in 2 their inadmissibility occurred. The APAs estimated in 2020 have made it possible to guarantee tax bases (generally, in the following four years) for an estimated value greater than 3,477 million euros, compared to the approximately 2,100 million guaranteed in the APAs estimated in 2019.

In turn, last year 2020, ONFI participated in 427 mutual agreement procedures regarding direct taxation, a figure that has increased significantly in recent years: 251 in 2017, 307 in 2018 and 371 in 2019. The ONFI's action in these procedures seeks to eliminate the double economic taxation generated in inspection actions and, simultaneously, to adequately defend the Spanish tax bases both in regularizations with cross-border scope carried out by the Spanish Administration, as well as in those carried out by the administrations of other countries. Of these total procedures, 110 were completed in 2020, compared to 108 in 2019. The tax bases affected by the mutual agreement procedures in 2020 amounted to more than 200 million euros, this figure being more than 800 in 2019.

Manager control over internal taxes

The purpose of management control is to detect and correct less complex errors and non-compliance. It is addressed to verifying in general all the tax debts individually considered, on the basis of the information held by the Tax Agency. It is based, fundamentally, on computer processes and documentary checks (without inspection of the taxpayer's company accounts), usually carried out in its own offices.

Management control is carried out by the Tax Management bodies; by the Tax Assistance and Services Unit with respect to the taxpayers assigned to the Central Delegation of Large Taxpayers (DCGC) and by the Large Business Management Units, dependent on the Financial and Tax Inspection area, with respect to the taxpayers about whom exercise their powers (among others, those over which the DCGC does not exercise its powers but whose volume of operations exceeds the figure of 6.01 million euros during the immediately preceding calendar year.

Personal Income Tax

The managerial control actions on this tax completed in 2020, regardless of the start year and the reference campaign, have been 722,148, 0.4% less than in 2019.

Furthermore, and within the framework of this tax, 147,648 settlements have been made for withholding control, 52.5% more than in 2019.

The results obtained are reflected in Table 33. Control actions in the Personal Income Tax (Annex). New window

Corporation Tax and Value Added Tax

During 2020, the actions completed throughout the year carried out in relation to Corporate Tax have reached 58,689 actions (6.6% more than in 2019), and those of the Value Added Tax have reached 318,966 (an 0.6% more than in 2019). To the Corporate Tax figures, 26,554 settlements for installment payments should be added (6.4% more than in 2019).

Regarding taxpayers registered in the register of monthly VAT refunds, the actions carried out throughout 2020 have been 19,632, compared to 18,067 the previous year. Which represents a growth of 8.7%.

Actions on taxpayers in Modules

In the case of taxpayers subject to the objective estimation regime, and under the criterion of actions completed in 2020, regardless of the start year and the reference campaign, 13,046 actions have been carried out, compared to the 18,390 carried out in 2019 (29 % less).

The results obtained are collected in Table 34. Results in the Module regime (Annex). New window

Verification of periodic tax returns.

On the basis of the census of employers, professionals and withholders, an automated inspection is performed of compliance with responsibilities of filing of periodical self-assessments (of Value Added Tax and withholdings and split payments).

During 2020, a total of 515,442 letters and requirements were issued, also attending to 36,981 hearing procedures and generating a total of 37,158 induced self-assessments presented for an amount of 43.3 million euros.

There were also 36,537 settlements for installment payments of Personal Income Tax, Corporate Tax and the simplified VAT regime, for an amount of 40.4 million euros.

These figures are part of the total annual settlement figures for each of the taxes referred to.

Reduction of negative tax bases

During 2020, the Tax Agency has worked on verifying negative tax bases or quota deductions to be offset in future years in the field of Corporate Tax, proceeding to verify the existence of its balance, its accuracy and its origin. These actions, although they may not be reflected in cash terms in the verification exercise, have a positive impact on the gross and liquid collection in future years. In 2020, the results of these actions have reached the figure of 2,896 million euros, of which the fundamental part derives from inspection actions.