The Tax Office urges business owners to apply, before 1 July 2021, for an extension of the special deferral of tax payments granted in connection with the coronavirus crisis. What situation does this apply to?
Two instalments
In the context of the special payment deferral scheme introduced in response to the coronavirus crisis, two deadlines are of particular importance:
- the period of three months following the submission of the application for special deferral of payment;
- the period that followed.
For the first instalment, special deferral of payment is granted with virtually no conditions attached.
However, further conditions apply to a request for an extension of the special deferral of payment beyond the first three months. In many cases, a statement from an independent expert is required.
Repayment
All tax liabilities accrued during the period of the special deferral remain outstanding. The total amount of these liabilities must be repaid in 36 equal monthly instalments with effect from 1 October 2021. Earlier repayment is, of course, permitted. If repayment within 36 months is not possible, business owners may contact the Tax and Customs Administration to arrange individual payment plans.
This flexible repayment scheme cannot be used if the company:
- although it has applied for a special deferral of payment (first instalment of 3 months);
- but has not submitted a request for an extension of this deferral of payment;
- and has not paid, or has not paid in full or on time, the tax liabilities arising after the end of the first three-month period.
In principle, all outstanding tax debts must then be paid by 1 July 2021. This also applies to tax debts that arose before the coronavirus crisis (before 12 March 2020) and which were covered by the special deferral of payment scheme (the pre-coronavirus debts).
Repair
This can be rectified by submitting a request for an extension of the special deferral of payment before 1 July 2021. Please bear in mind, however, that the Tax and Customs Administration will then carry out a substantive assessment. If the outstanding tax debt exceeded €20,000 at the time of the initial application for the special deferral of payment, a statement from an independent expert must be submitted to the Tax and Customs Administration when applying for an extension of the special deferral of payment.
Doubt
Not sure whether you’ve paid all your tax debts? At the end of our factsheet on special payment deferrals, you’ll find details of how to request a statement of your debts from the Tax and Customs Administration. You can find this factsheet here.
Visual
The Tax and Customs Administration has summarised it all in a clear visual:
