Skip to content
Back to index
V2451-14 18 September 2014 · SG de Impuestos sobre el Consumo Criterion in force
IVA · base imponible

Abandonment of legal proceedings following debtor opposition prevents reduction of VAT taxable amount

The inquiry examines whether the VAT taxable amount can be reduced due to bad debts when, following a debtor's opposition in a summary procedure, the creditor fails to file a lawsuit within the deadline, resulting in a dismissal. The DGT rules that abandoning the legal proceedings prevents the reduction or necessitates an upward rectification.

The question raised

Possibility of modifying the taxable base pursuant to Article 80.Four of Law 37/1992.

The DGT's ruling

To reduce the taxable base due to bad debts, the taxpayer must pursue collection through judicial claim. Withdrawal or any form of abandonment of the initiated judicial proceedings entails the obligation to upwardly adjust the taxable base. In a monitoring process, if the debtor opposes and the creditor fails to file the corresponding lawsuit within the legal period, the dismissal is considered an abandonment that prevents the reduction of VAT.

Book your free first meeting