Related operations are a type of operations that have been placed under the watchful eye of the Tax Authorities as they are considered possible subterfuges for tax fraud. Linked operations are those commercial relations that are developed by individuals or legal entities with some kind of link between them and, in an attempt to avoid tax fraud, they must be declared in Form 232. Do you know if you are obliged to declare them?
What is a related-party transaction?
Linked transactions are dealings between companies or individuals that are related to each other and have an economic value. Relationships that are considered to be linked include:
- A business and its owners or partners.
- A company and its leaders, except for payment for their duties.
- A business and the immediate family members of the owners or leaders, up to a certain degree of kinship.
- Two companies that are part of the same group.
- A company and the leaders of another company if both belong to the same group.
- A company and another company in which it has at least 25% ownership.
- Two companies in which the same persons have at least 25% ownership.
- A company in Spain and its operations abroad.
|Who needs to fill out this form?
If you are a company that pays taxes in Spain or you have business here, and you do transactions with people or companies related to you, you need to complete this form.
What type of transactions are covered?
All transactions with the same person or related company are relevant if the total in one year is more than 250,000 euros. In addition, if there are specific transactions that exceed 100,000 euros in a year, you also need to report them.
When do you not need to complete this form?
If your business is related to companies in the same group to which you belong, or if you work with other companies under the same group. You also do not need to report certain special partnership transactions, unless they follow a particular regime in the law.
When must this form be filed?
You have to do it in November after the end of your tax year. For example, if your tax year ends on December 31, you must file from November 1 to November 30.
How do I file?
It must be done online through the Tax Agency’s website. It can be completed by the company or its legal representative.
Does the Tax Agency verify these transactions?
Yes, they can review the transactions and make sure they are valued correctly according to the normal market. If they find discrepancies, they can correct the valuation based on the documentation you provide and the information they have.
Do you need help with your tax and accounting obligations? Do not hesitate to contact us and we will advise you!