The Spanish General Accounting Plan (PGC) is the mandatory accounting regulatory framework for all Spanish companies, approved by Royal Decree 1514/2007, of 16 November. It governs accounting principles, the chart of accounts, the presentation of annual accounts, and the criteria for recognising and measuring assets and liabilities. In 2026, accounting digitisation — with the progressive entry into force of mandatory e-invoicing — introduces new practical implications for accounting records across companies of all sizes. This guide explains the PGC structure, its differences from the SME PGC, the applicable accounting principles and the year-end obligations for 2025.
Legal framework: the rules that govern accounting in Spain
Company accounting in Spain is governed by a hierarchical body of regulation:
- Commercial Code (Royal Decree of 22 August 1885): establishes the obligation to keep accounts, the mandatory books (Day Book and Ledger) and the basic rules on annual accounts (Arts. 25–49).
- Corporate Enterprises Act (RDL 1/2010): governs the preparation, approval and deposit of annual accounts for commercial companies (Arts. 253–282).
- General Accounting Plan (Royal Decree 1514/2007, of 16 November): the complete accounting framework for all companies. It has five parts: Conceptual Framework, Recognition and Measurement Rules, Annual Accounts, Chart of Accounts, and Definitions and Accounting Relationships.
- SME General Accounting Plan (Royal Decree 1515/2007, of 16 November): a simplified version for companies not exceeding two of the three size thresholds (assets ≤ €4M, turnover ≤ €8M, employees ≤ 50).
- ICAC Resolutions: the Accounting and Audit Institute issues binding rulings on specific accounting policies (micro-entities, pension plans, financial instruments).
In the regulatory hierarchy, EU-adopted IFRSs take precedence for listed and consolidating entities; the rest apply the national PGC.
Structure of the General Accounting Plan: five parts
The PGC is organised in five parts with different legal standing:
Part 1: Conceptual Framework for Accounting
Defines the elements of the annual accounts (asset, liability, equity, income, expense), accounting principles, recognition criteria and measurement bases (historical cost, fair value, value-in-use, present value). It is the theoretical foundation of the PGC and is mandatory for interpreting the measurement rules.
Part 2: Recognition and Measurement Rules
These are the 23 specific rules on how to recognise and measure each type of asset or liability: property plant and equipment, intangibles, investment property, financial instruments, inventories, foreign currency, income tax, grants, leases, provisions, income, etc. They are mandatory and may not conflict with the Conceptual Framework.
Part 3: Annual Accounts
Sets out the presentation formats for the balance sheet, profit-and-loss account, statement of changes in equity (SOCE), statement of cash flows (SCF) and the notes. For SMEs, the SCF and SOCE are optional. Normal and abbreviated formats exist depending on company size.
Part 4: Chart of Accounts
The catalogue of accounts organised in 9 groups, with two, three, four and five-digit codes. It is indicative (using these exact codes is not mandatory), although in practice all Spanish accounting software follows it entirely. Four and five-digit accounts are sub-categories that a company may create or adapt.
Part 5: Definitions and Accounting Relationships
Defines the content of each account and the transactions that generate debits and credits. It is the practical guide for the accountant who needs to know which account to use for a given transaction and the corresponding contra-account.
The 9 PGC account groups: practical summary
| Group | Name | Main elements |
|---|---|---|
| 1 | Basic financing | Share capital, reserves, profit for the year, long-term debt, grants |
| 2 | Non-current assets | Property, plant and equipment (machinery, vehicles), intangibles (patents, software), accumulated depreciation, long-term financial investments |
| 3 | Inventories | Merchandise, raw materials, work in progress, finished goods |
| 4 | Trade creditors and debtors | Customers, debtors, suppliers, creditors, AEAT (VAT, withholdings), Social Security |
| 5 | Short-term financial accounts | Cash, banks, short-term financial investments, short-term loans |
| 6 | Purchases and expenses | Merchandise purchases, personnel costs, external services, depreciation, impairment |
| 7 | Sales and income | Merchandise sales, service income, financial income, grants to income |
| 8 | Expenses attributed to equity | Losses on available-for-sale financial instruments, cash flow hedges |
| 9 | Income attributed to equity | Gains on fair-value instruments through equity, capital grants |
Groups 1–5 contain balance sheet elements (assets, liabilities, equity). Groups 6–7 contain profit-and-loss flows. Groups 8–9 affect equity directly without passing through profit or loss (hedging operations, fair value changes on financial instruments).
Accounting principles: the 6 pillars of the PGC
The PGC accounting principles are mandatory; non-compliance is a regulatory breach:
1. Going concern
The company is assumed to continue operating in the foreseeable future. Where there are doubts about continuity (recurring losses, negative equity, refinancing difficulties), the company must disclose these uncertainties in the notes and the auditor must include them in their report as a ‘material uncertainty’.
2. Accrual
Income and expenses are recognised when the right to receive them or the obligation to pay them arises, regardless of when cash is received or paid. A December rent invoice collected in January is recognised as income in December. This principle is essential for correct year-end accruals.
3. Consistency
Adopted accounting policies must be maintained from one period to the next. A change in policy (for example, from straight-line to declining-balance depreciation) is permissible only if required by a standard or if the new policy provides more reliable and relevant information. The change must be explained in the notes with retrospective effect on prior-period comparatives.
4. Prudence
Only profits realised at the balance sheet date are recognised. However, all foreseeable risks and potential losses must be recognised, even if discovered after the year-end. The prudence principle requires, for example, recognising the impairment of doubtful receivables even if the customer has not formally acknowledged their inability to pay.
5. No netting
Assets and liabilities may not be netted, nor income against expenses, unless a specific rule permits it. Customer and supplier accounts of the same counterparty are not netted, even if there is a contractual set-off arrangement (net settlement on the balance sheet is only permitted if there is a legally binding netting agreement and the company intends to settle on a net basis).
6. Materiality
Strict application of a principle or rule may be omitted when non-compliance has negligible quantitative significance and does not distort the true and fair view. This principle allows companies to forego minor accrual adjustments or to omit note disclosures when the amount is irrelevant.
The 2025 accounting year-end: key operations
The 2025 accounting year-end must be completed between 1 January and 31 March 2026, the usual window before the annual accounts are prepared. The critical operations are:
Inventory reconciliation
The physical stock count carried out at the year-end (31 December) must reconcile with the accounting records. Inventory differences (shrinkage, breakages, obsolescence) are posted by adjusting the inventory accounts and charging to results. Under the PGC, inventories are measured at purchase price or production cost, using FIFO or weighted average as the cost flow assumption (LIFO is not permitted).
Accruals and prepayments
Income and expenses accrued but not received or paid at the year-end must be accrued:
- Prepaid expenses (insurance premiums, advance rent payments): deferred to Account 480 (Prepaid Expenses) and charged to the following year.
- Deferred income (advance receipts for future services, rent received in advance): deferred to Account 485 (Deferred Income).
- Accrued interest on loans or deposits not yet received or paid: recognised in accrued interest receivable/payable accounts with a contra-entry to results.
Fixed asset depreciation
The Corporate Tax depreciation tables (RD 634/2015) are the standard reference for accounting depreciation in practice, although technically the PGC requires depreciation over the actual useful life. Any difference between accounting and tax depreciation (when it exists) generates deferred taxes that must be recognised in accordance with NRV 13 of the PGC.
Asset impairment
At the year-end, the company must assess whether there is objective evidence of impairment in:
- Customers and debtors: balances more than 6 months past due, customers in insolvency proceedings, customers with repeated payment defaults. Impairment is recognised in Account 490 (Impairment of Trade Receivables).
- Inventories: obsolete, damaged or below-cost items. Recognised in Account 390 (Impairment of Inventories).
- Fixed assets: if the recoverable amount (higher of value-in-use and fair value less costs to sell) is below carrying value, impairment is recognised in Accounts 290 and 291.
Corporate Tax: calculating the accrued expense
The year-end close includes calculating the Corporate Tax expense accrued for 2025. This calculation requires:
- Starting with the pre-tax accounting profit.
- Making the extra-accounting adjustments (permanent and temporary differences between accounting and tax results).
- Calculating the gross tax liability at the applicable rate (25% standard, 23% for SMEs with prior-year turnover < €1M, 15% for startups in their early years).
- Recognising the current tax expense (Account 630) and, where temporary differences exist, deferred taxes (Accounts 479 and 474).
2026 developments and trends: accounting digitisation
B2B e-invoicing: impact on accounting records
Law 18/2022 (Crea y Crece) makes it mandatory to issue and receive e-invoices in structured format (Facturae XML or equivalent UBL/CII) for all B2B relationships between companies and sole traders. The roll-out is staged: large companies (turnover > €8M) first; other companies and sole traders in a second phase.
The direct accounting impact is twofold:
- Automatic invoice posting: certified ERPs must be able to read the invoice XML and automatically generate the accounting journal entry without manual intervention. This reduces data capture errors but requires a correctly configured chart of accounts.
- Integrity verification: the e-invoice must be retained in its original format with a valid digital signature. The accounting software must manage the e-invoice archive in a way that ensures accessibility during the mandatory retention period (at least 4 years for tax purposes; 6 years for commercial purposes).
Immediate Information Supply (SII)
Companies subject to SII (turnover > €6M or voluntary opt-in) already submit their VAT ledgers to the AEAT in near-real time. In 2026, the AEAT is advancing the integration of SII with e-invoicing systems, reducing duplication of submissions. For these companies, invoice accounting records and VAT records must be perfectly synchronised, as the AEAT cross-checks both sources.
Micro-entities: ICAC simplifications
Micro-entities (assets ≤ €1M, turnover ≤ €2M, employees ≤ 10) may present the balance sheet and P&L in an ultra-abbreviated format under ICAC guidance. The notes may be reduced to a minimum number of disclosures. In 2026, the ICAC is reviewing the micro-entity regime to align thresholds with the update to the European Accounting Directive (Directive 2013/34/EU and its amendments).
Annual accounts deposit obligations
Deadlines and procedure
| Milestone | Deadline |
|---|---|
| Year-end | 31 December 2025 |
| Preparation by directors | Before 31 March 2026 (3 months) |
| Audit (if required) | Before the general meeting |
| Approval by the ordinary general meeting | Before 30 June 2026 (6 months) |
| Deposit at the Companies Registry | Before 31 July 2026 (1 month after approval) |
Companies required to have a statutory audit
An audit is mandatory when a company exceeds two of three thresholds for two consecutive years: assets > €2.85M, turnover > €5.7M, or employees > 50. It is also mandatory for listed companies, bond issuers, credit institutions, insurers and other public-interest entities, regardless of size.
Consequences of non-compliance
Failure to deposit the accounts results in:
- Registration closure: the Companies Registry will not register any documents relating to the company until the breach is remedied, except for director resignations, appointments and court orders.
- ICAC fines: from €1,200 to €300,000 depending on annual turnover (Art. 283 LSC), with recidivism possibilities.
- Negative publicity: non-deposit is publicly accessible information at the Companies Registry, and commercial credit platforms include it in their reports.
How BMC can help with your 2026 accounting
BMC’s accounting team manages the 2025 year-end close and annual accounts preparation for more than 300 companies in Málaga, Madrid, Murcia, Marbella and Las Palmas. Our services include:
- 2025 accounting year-end: accruals, depreciation, impairment, Corporate Tax calculation and annual accounts preparation.
- Monthly accounting with real-time access: BMC clients have permanent access to their accounting data via an online portal updated monthly before the 15th.
- E-invoicing adaptation: diagnosis of the current invoicing system, selection of compatible certified software for Facturae, and seamless migration.
- Coordinated audit: if your company requires a statutory audit, BMC coordinates the process with independent auditors and prepares the management report.
- Fractional CFO: for SMEs that need financial oversight without the cost of a full-time finance director, BMC’s fractional CFO service oversees the close, budgeting and cash flow planning.
For any questions on the 2025 year-end close or e-invoicing adaptation, contact our accounting team.
