Deferred payment of VAT for self-employed entrepreneurs and SMEs in Spain

Spanish Minister of Finance and Public Administrations, Cristóbal Montoro, announced that the Spanish government will approve a new measure in March 2013 regarding the payment of VAT for self-employed entrepreneurs and SMEs in Spain.

However, as also announced the Spanish Prime Minister Mariano Rajoy during the debate on the state of the Nation, this measure will come into force from January 2014.

This new measure will allow self-employed entrepreneurs and SMEs to be exempt from VAT payment as invoices are not paid in. In other words, the payment of VAT is deferred until the self-employed entrepreneur or SME has banked the bill. The only condition to benefit from this measure will justify billing under 2 million from the companies. The aim is to avoid that businesses pay VAT without banking invoice. In this way, they have not to carry out cash advances.

Approximately 1.3 million self-employed entrepreneurs and more than one million SMEs in Spain may apply this new payment flexibility.

This new measure will also include a new tax deduction for small and medium businesses that reinvest their profits in fixed asset such as production tools or office equipment.

If you are interested by the new measures put in place by the government Rajoy for entrepreneurs and self-employed entrepreneurs in Spain, please read this article.

Source : El País