Taxwise and regarding companies, the Government has declared the following delays in the deadlines for the fulfilment of the obligations:
- The deadline for the payment of the First Special Payment on Account that would end on the 31st of March, will now end the 30th of June 2020;
- The deadline to deliver the Model 22 declaration and the Corporate Income Tax (IRC) will now only end on the 31st of July 2020;
- The First Payment on Account, which deadline would end on the 31st of July, has been postponed for the 31st of August 2020.
The Government has meanwhile reinforced the telephone service in order to avoid presential appointments at the Tax Services.
Regarding incentives, it has been announced the creation of a line of credit for micro, small and medium companies, which is available since the 12th of March 2020 and will have 200 million euro available, in a maximum of 1,5 million euro per company. The Capitalize Line - Covid-19, has the finality of supporting the companies which activity is affected by the economic effects of the Pandemic and works in a logic of “first-come first-serve”.
It is eligible for companies which sales have decreased at least 20% in the 60 days prior to the finance request in comparison with the homologue period of last year.
UPDATE TO THE COVID19 MEASURES - Administrative Rule nr. 76-B/2020, March 18th
Following the last announcement by the Minister of State and Finance, new measures are foreseen with a view to guaranteeing flexibility in tax and contributory obligations in relation to payments of Value Added Tax (“VAT”) and in the delivery of withholding taxes to the State Income Tax on Individuals (“IRS”) and Income Tax on Legal Entities (“IRC”):
These measures allowed that, on the due date of the payment obligation, it can be fulfilled in one of the following ways:
- Immediate payment (virtual and in the usual terms);
- Payment divided into three monthly installments without interest; or
- Payment divided into 6 monthly installments, with interest on arrears being applied only to the last 3 monthly installments.
This measure is applied to self-employed workers, and companies with a turnover of up to 10 million euros in 2018, or starting in January 2019.
However, the remaining companies or independent workers may require the same flexibility in the payment of these tax obligations in the 2nd quarter of 2020, when they have seen a decrease in turnover of at least 20% in the average of 3 months prior to the month in which the obligation exists, compared to the same period of the previous year.
The contributions due during the months of March and May 2020 are reduced to 1/3 in the months of March, April and May;
Since the remaining amount, relating to the months of April, May and June, is settled from the third quarter of 2020, in terms similar to the installment payment adopted for the taxes payable in the second quarter.
This announced measure will be applied to Companies with up to 50 jobs, immediately, and companies with up to 250 jobs, can access this mechanism for reducing and fractioning the payment of social contributions in the 2nd quarter of 2020, if have seen a drop in turnover greater than or equal to 20%.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.