As the second instalment of the 2025 Spanish income tax return approaches, it is worth revisiting how the Tax Office deals with late or missed payments. Many taxpayers chose to split their payment into two parts, with 60 per cent due in June and the remaining 40 per cent in early November. The rules seem straightforward, but the consequences of missing either payment can quickly become expensive.
When the second instalment is not paid
If the first payment was successfully made in June but the second charge (normally 5 November) fails, the unpaid balance becomes an outstanding debt from the following day. The case then enters the collection process, and the Tax Office applies surcharges depending on when the payment is made:
- 5 % if the payment is made voluntarily before any formal notice is issued
- 10 % if the payment is made after receiving a notice but before any recovery measures begin
- 20 % if recovery proceedings have already started, in which case late-payment interest is also added
These surcharges apply only to the unpaid 40 % of the total tax. If no action is taken, the Tax Office may recover the amount directly from bank accounts or other assets, and interest will continue to accrue.
When the first instalment was not paid
A more serious situation arises when the taxpayer chose the two-instalment system but the first payment in June was not successfully charged, for example because the account had insufficient funds or was closed. In this case the tax office considers the instalment agreement to have been breached and the entire amount of the income tax debt (1st and 2nd instalment) becomes immediately payable.
The debt enters the collection process, and the tax office applies the same system of surcharges as before:
- 5 % if paid voluntarily before any formal notice
- 10 % if paid after receiving a notice but before recovery measures start
- 20 % if recovery action is already in progress, plus interest on late payment
Because the first payment was not completed, the taxpayer loses the right to pay in two parts, and these surcharges are calculated on the total amount of the tax due, not just the first instalment.
When the return was filed late
Filing the income tax return after the official deadline is a separate issue. When the result is a refund, there is normally no penalty, although interest may be applied if the delay is considerable. When the return results in a payment, the Tax Office applies a 1 % surcharge for each month of delay, increasing automatically with time. After twelve months, a 15 % surcharge applies together with late-payment interest.
If the Tax Office issues a formal notice before the return is filed, the matter becomes a tax infringement rather than a simple delay. In that case, penalties range from 50% of the unpaid tax, depending on the circumstances and whether there was intent or repetition.
Final thoughts
A failed direct debit or an unreported change of bank account can easily lead to unexpected surcharges. It is essential to ensure that the account details held by the Tax Office are up to date and that sufficient funds are available when the charges are made.
Even small oversights can lead to avoidable costs. Reviewing your payment status and notifying any change of bank account in advance is always safer than discovering a problem after the deadline.
If liquidity problems are anticipated, it is always better to request an official deferral before the first due date. Once the first payment fails, the agreement is considered void and cannot be reinstated automatically.
At Spence Clarke & Co. we assist clients who have received notices or surcharges from the Tax Office, review the applicable interest and manage deferral applications to ensure full compliance with the Spanish tax authorities.
