Cash Paments Restricted !!!!

Tomorrow, November, the 19th, the new Law 7/2012, to fight against tax fraud, becomes in force.

One of the declared goals of the new Law is to set more restrictions to prevent people from paying cash transactions. Let´s see how the Spanish goberments is forcing us, the people, to change old habits of cash paying.

If you are taking part into a  transaction for business or professional reasons (the one by  which any of the parties act as an entrepreneur or professional ) payments in cash can not exceed an amount equal to or greater than 2,500 euros.

If the reason of the deal it is a personal one, provided you can proof you are non resident in Spain, no more than 15.000 € should be acceptable.

Is also important to bear in mind that cash include not only money, but also bankers checks issued to the bearer.

As well, to calculate the amounts, the law states expressly that to calculate those limits, all transactions or payments that may have split the delivery of goods or provision of services are accountable.

Failure to comply with this measure is an administrative violation, being jointly responsible both payer and recipient of the sanction to be imposed, this being a financial penalty proportional 25% of the basis of the sanction.

As a novelty, so that the action does not give rise to liability for infringement, the parties involved in the transaction should be reported to the Tax Office, within 3 months from the date of payment, the operation performed, the amount and identity of the other party to.

So, like Bob Dylan once said, Times are a´changing.

Prepare your self to change also your habits.

Javier Herrera Llamas