The Provincial Declaration of the Annual VAT Summary (Form 390) does not interrupt the prescription


Ruling of the Spanish Supreme Court of February 14, 2023, in response to an appeal

This decision tries to determine if the submission of the Provincial Declaration of Guipúzcoa related to the Annual Summary of VAT (Form 390) constitutes a case of interruption of the prescription of the Administration’s right to determine the tax debt or if, on the contrary, it does not have any interruptive power in this territory.

First of all, it is convenient to clarify the following peculiarity, since unlike what happens in the Common Territory, in the Historical Territory of Guipúzcoa the last VAT return, corresponding to the fourth quarter or the month of December, of the year, is included in the Annual VAT Summary.

Once this has been clarified, we will present the case in a summarized way.

In January 2018, the Gipuzkoa Foral Treasury issued a provisional settlement, corresponding to the VAT for the year 2013, indicating that the entity PORTABASK SL had not declared the VAT accrued as a result of the acquisition of a property (in the second quarter of 2013), in which the reverse charge rule should have been applied and, therefore, it should self-charging the tax. In this sense, this body proceeded to modify the VAT tax base for the second quarter of 2013.

Although said mistake in the declaration of this operation did not imply the generation of an additional VAT quota to be paid by PORTABASK SL (since it was entitled to deduct the VAT from the operation), however, it did imply the opening of a penalty process for not having entered the self-charged VAT in the return, imposing a penalty of 54,180 euros on the company.

PORTABASK appealed this decision in different instances, reaching, in cassation, up to the Spanish Supreme Court, based on the fact that, according to its criteria, the submission of the Annual VAT Summary corresponding to the tax year 2013 did not interrupt the prescription of the right to determine the corresponding tax debt for the real estate transfer operation carried out in the second quarter of 2013. Therefore, both the right to determine the tax debt and the action to impose sanctions for the events carried out in this quarter would have prescribed.

However, the Provincial Council of Guipúzcoa claimed, based on article 26 of the Economic Agreement Law, that the Provincial Institutions have the power to provide that the fourth quarter of VAT for each year be declared, incorporating it into the Annual VAT Summary (model 390), which has interruptive effects of the prescription for the entire year, without the need to submit a specific model 300 corresponding to the fourth quarter of the year and, consequently, confirm the Judgment appealed to the contrary.

Law of the Economic Agreement with the Autonomous Community of the Basque Country

Article 26

The Value Added Tax is a concerted tax that will be governed by the same substantive and formal rules established at all times by the State. However, the competent institutions of the Historical Territories may approve the declaration and payment models that will contain, at least, the same data as those of the common territory, and indicate payment deadlines for each settlement period, which will not differ substantially from those established by the State Administration.

This Provincial Council understands that the informative nature of the annual declaration does not undermine its liquidation nature.

For its part, the PORTABASK entity understands that the aforementioned power mentioned in this article must be interpreted in accordance with the General Tax Law, as provided in article 3 of this same law of the Economic Agreement with the Autonomous Community of the Basque Country.

Considering the arguments of the appellant party, the Court rules in favour of the latter, upholding the appeal for the following reasons:

  1. Article 26 of the Economic Agreement Law must be interpreted in the sense that, although it authorizes the competent foral body to approve declaration and income models in Guipúzcoa, it does not allow, under its protection, to replace the annual summary settlement regime for self-assessment with a different regulation and, even less, so that a new cause of interruption of the extinctive prescription in VAT matters arises from the change of system, different from that attributed to model 390 that governs for the State Administration.
  2. The submission of the Annual VAT return-summary, model 390, approved in the Foral Order 3196/2012, of December 21, does not constitute a case of interruption of the prescription of the Administration’s right to determine the tax debt, in light of article 26 of the Economic Agreement Law.
  3. The prescription is not interrupted by the mere submission of an Annual declaration -even when it is in the form known as self-assessment- when its declarative content is limited to ratifying or summarizing what was previously declared by the interested party in his previous periodic declarations, as it is not fulfilled in such terms that it is “…any reliable action of the taxpayer leading to the liquidation or self-liquidation of the debt…”.


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