4.2.1. Control over internal taxes

Control actions on internal taxes include the following actions, excluding those related to special taxes, environmental taxes and those on foreign trade:

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

The purpose of inspection control actions is to detect and regularise the most complex breaches and to pursue 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 DCGC who are entrusted with the development of tax inspection.

Its implementation has a large investigative component and generally requires an exhaustive review of the tax situation of the taxpayer subject to inspection, for which the bodies that carry it out are endowed 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-compliances and is characterised by the fact that it is aimed at the general public during annual campaigns, with strong support from the available information and the computer system that analyses it. It refers to obligations considered individually, is based on formal and documentary controls, without reviewing the taxpayer's business accounting, and is normally carried out from the offices themselves.

The management control is carried out by the corresponding bodies of the Special Delegations, of the DCGC and, where appropriate, the National Tax Management Office.

Along with these controls, 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, on 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 and Customs Control Unit, integrated respectively in the Tax Assistance and Services Unit and in the Tax and Customs Control Unit of the DCGC.

The actions of management control over large companies include, among others, the verification of the refunds provided for in tax regulations and the performance of data verification and limited verification actions that may give rise to subsequent liquidations.

Along with the above verification actions, this indicator also includes investigative and auxiliary actions.

In 2024, the Tax Agency's internal tax audit activity concluded with nearly 2 million internal tax audits, representing a 4.39% increase over the previous year. Of this total number of inspections, 46,407 scheduled actions, 6.3% more than in 2023, targeted large companies, multinationals and tax groups, personal assets, corporate abuses, and the underground economy. These types of actions consume a significant amount of resources, which are also characterized by their high qualifications.

Inspection activities on domestic tax contributions

These actions include all those carried out by the bodies of the Financial and Tax Inspection area of the Special Delegations and the DCGC, in the exercise of the administrative functions attributed to the tax inspection by article 141 of the General Tax Law.

These actions may be of a verification, investigative or auxiliary nature.

The total amount of debt settled in 2024 amounted to €4,142.19 million, 20.29% less than in 2023, a decrease motivated by the effects of the Constitutional Court's ruling of January 18, 2024, which declared the unconstitutionality and nullity of the measures contained in the fifteenth Additional Provision and section 3 of the sixteenth transitional provision of the LIS, as amended by Royal Decree-Law 3/2016, of December 2.

The amount of settled debt includes both debt incurred and settled in the 2024 financial year itself, as well as debt incurred in previous financial years and settled in 2024. However, debt incurred in the financial year but contained in records that have not been confirmed at the end of the 2024 financial year is not included.

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

Control of large estates: Since its creation in 2018, the Central Unit for the Coordination of 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 appropriate investigation and selection mechanisms to detect said risks in specific taxpayers and the promotion of initiatives regarding the effective obtaining and/or management of relevant information. During 2024, work continued on actions to verify tax contingencies associated with taxpayers listed as holders of significant assets. This type of inspection has resulted in debt settlements totaling €524 million in 1,264 cases. These figures are complemented by the analysis of the tax bases and quotas declared in the PIT by taxpayers with significant assets.
Actions on the underground economy, focused on:
- 2,581 inspections have been carried out by the Agency's various delegations, which have revealed the existence of sales that the taxpayer had concealed from the Tax Administration, 11.39% more than the previous year. As a result of these actions, fees derived from the discovery of hidden sales totaling €431 million have been assessed.
- More than 1,648 entries and records were recorded with Computer Audit Units, which, in addition to facilitating the discovery of hidden income by analyzing dual-use software used in the management and accounting of economic activities, are extremely efficient in terms of obtaining evidence and reducing the duration of audits.
- coordinated actions, consisting of the simultaneous initiation of verification and investigation actions, through personal appearance and with the participation of the Computer Audit Units, and which seek not only to discover hidden sales by the inspected taxpayers, but also to promote voluntary compliance by transmitting a message to the group of business owners in the sector so that they redirect their tax conduct.
Actions to exploit international information from DAC1, CRS-DAC2, FATCA, DAC3-Tax rulings and CBC-DAC4. Specifically, the ONIF has continued to work on the exchange of information with other countries and jurisdictions relating to the following categories:
- Information on employment income, directors' income, pension income, life insurance product income, property ownership and real estate income, and, for the first time, the royalties category (DAC1) has also been changed.
- Information on foreign financial accounts (CRS, FATCA and DAC2).
- Country-by-Country Reports (CBC and DAC4)
- Information on consultations and prior tax arrangements with cross-border effects and on transfer pricing (DAC3 and exchange of Tax Rulings within the framework of the OECD).
- Exchange of information on certain reportable cross-border tax planning arrangements (DAC 6).
- Digital Platform Information Exchange (DPI-DAC7), the first exchange of which took place in 2024.
- Exchange of Information on Cross-Border Payments (CESOP), the first exchange of which took place in 2024.
Actions on small businesses through procedures specialised in the size of the entities and the characteristics of their tax risks, by promoting abbreviated checks.

International taxation

Throughout 2024, the National International Taxation Office (ONFI) has contributed, through the development of its important functions, to the general objectives of promoting voluntary compliance and combating international tax fraud and avoidance. The activity of the ONFI This has materialized both in actual inspection actions, completing 268 actions, and in the relevant assistance of its officials to working groups in international organizations, fundamental in matters of international taxation, as well as participation in planning and coordination functions of the inspection action.

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 negotiation in mutual agreement procedures in matters of direct taxation.

The ONFI It carries out support and collaboration actions in inspection procedures, focusing on complex issues in international taxation. This activity has special significance in the field of inspection actions of the DCGC. In 2024, the ONFI collaborated in 140 inspections, of which 88 have been completed, resulting in estimated tax base adjustments of around €2.712 billion. In the previous year, the company participated in 138 inspections, of which 87 were completed, resulting in a total adjustment to the tax base of €2.925 billion.

In relation to the APAs (advance agreements for the valuation of related-party transactions), the actions of the ONFI seek, through these advance agreements on transfer pricing, to reduce litigation and improve the legal security of the taxpayer, guaranteeing collection in accordance with the requirements of the law. In 2024 the ONFI has participated in the management of 232 APA files, having completed 81, of which 48 were upheld, 14 rejected and in 19 cases the applicants withdrew. The estimated APAs for 2024 have helped secure taxable bases (generally in the following four fiscal years) for an estimated value of more than €3.797 billion.

Likewise, last year 2024, the ONFI participated in 739 mutual agreement procedures in matters of direct taxation (provisional data), compared to 662 in 2023 with updated figures. The performance of the ONFI In these procedures, the Court seeks to eliminate the double economic taxation generated by inspection actions and, simultaneously, adequately defend the tax bases that must be taxed in Spain, both in cross-border regularizations carried out by the Spanish Administration and in those carried out by the administrations of other countries. Of that total, 99 procedures were completed in 2024 (provisional data), compared to 174 in 2023. The tax bases affected by the mutual agreement procedures finalized in 2024 amounted to more than €927 million, rising to €1.051 billion in 2023. It should be noted that the number of cases concluded in 2023 was much higher than in previous years and meant that, for the first time since 2017, the case inventory at the end of the year was lower than at the beginning.

Manager control over internal taxes

The purpose of management control is to detect and correct less complex errors and non-compliances. 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 Department with respect to taxpayers assigned to the DCGC, and by the Large Company Management Units, dependent on the Financial and Tax Inspection area, with respect to the taxpayers over whom their powers are exercised (among others, those over whom the DCGC does not exercise its jurisdiction but whose volume of operations exceeds the figure of 6.01 million euros during the immediately preceding calendar year).

Personal Income Tax

The number of administrative control actions for this tax completed in 2024, regardless of the start year and the reference campaign, was 732,939, 1.9% less than in 2023.

In addition, and within the framework of this tax, 184,231 withholding tax control settlements have been made, 7.7% more than in 2023.

The results obtained are reflected in the Table 34. Control actions in the Personal Income Tax (Annex).

Corporation Tax and Value Added Tax

During 2024, 45,493 Corporate Tax-related actions were completed throughout the year. To this figure must be added 34,636 settlements for split payments.

In terms of Value Added Tax, 462,347 actions were carried out, an 8.4% increase compared to the previous year.

Actions on taxpayers in Modules

For taxpayers subject to the objective assessment system, and based on the criteria of actions completed in 2024, regardless of the start year and the reference campaign, 29,116 actions were carried out, 3.92% fewer than in 2023.

The results obtained are collected in the Table No. 35. Results in the Modules regime (Annex).

Verification of periodic tax returns.

Automated checks are performed on compliance with tax liabilities of periodic self-assessments (Value Added Tax, withholdings and instalment payments) for registered business persons, professionals and withholders.

During 2024, a total of 516,632 letters and requests were issued, in addition to 44,704 hearing procedures and generating a total of 42,746 self-assessments filed for an amount of 82.1 million euros..

There were also 45,854 settlements for split payments of PIT, Corporate Income Tax and simplified regime of VAT, for an amount of 59.9 million euros.

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

Census purge. Revocation of NIF

Within the corporate group there is a significant part made up of inactive companies or companies with little or no activity. Often such companies have simply been abandoned by their directors and partners without carrying out the legal acts that the legal system provides for cases of termination, extinction and dissolution of the legal entity.

This type of attitude, which is detrimental to the proper management of the resources that the Tax Agency allocates to control, forces it to serve a group of potential taxpayers that is much larger than those that actually carry out economic activities. Furthermore, it can lead to fraud by using, in one way or another, these apparently inactive companies. Finally, the OECDconsiders that these inactive legal entities potentially conceal the true ownership of assets and rights, in Spain or in other jurisdictions, and thereby affect the transparency of our system in the knowledge and communication of the Effective Beneficiary.

The tax law provides for certain consequences for these behaviors:

The closure of the Commercial Registry page is, in addition to the consequence of non-compliance with certain registry obligations, a sanction that derives from the repeated non-compliance with tax obligations that previously determine the removal from the Entity Index. Likewise, registration closure may be a consequence of the revocation of the NIF.
The revocation of the NIF, which prevents the continuity of the fiscal life of the company itself.

These measures are intended to ensure that the censuses are properly cleaned up, so that only those companies that really intervene in the commercial or economic sphere maintain their full legal and fiscal life.

Following the special campaign carried out in 2023, in the 2024 financial year this work of purging the censuses aimed at combating inactive entities has continued, which has led to the revocation of the NIF 39,882 of them.

Reduction of negative tax bases

In 2024, actions aimed at reducing negative tax bases, deductions, and offsets declared by taxpayers reached €5.305 billion, compared to €3.356 billion the previous year.

Of that result obtained in 2024, 3,577 million, 67% of the total, corresponds to actions of the DCGC.

These actions have a positive impact on gross and net revenue in future years.