THE SELF-EMPLOYMENT REFORM LAW IS BEING INAPPLICABLE

By: Josep Navarro

THE CONFUSING WORDING AND RESTRICTIVE INTERPRETATION BY THE TAX OFFICE LEAD TO UNCERTAINTY AND INSECURITY IN THE COLLECTIVE

The majority of the self-employed who should have the right to deduct living expenses when for work reasons they have to eat away from home, do not do so because of the confusion with which it drafted the legal rule and the restrictive interpretation that seems to make the Tax Agency of the same.

Let us remember that in the case of the deduction of maintenance allowances, three fundamental requirements had to be met:

1st The deductible expense is produced as a consequence of the economic activity carried out by the self-employed.

2ª Occurs in catering and hotel establishments.

3ª It is paid by electronic means.

Something that a priori can be simple has become a handicap for it to be carried out. It is an absolute nonsense in practice, since if a self-employed person has to prove that the economic activity is affected by the maintenance to be deducted, the burden of proof is transferred to the interested party, with a very complicated evidentiary procedure, since in the hypothetical case of an inspection by the tax office and after a significant period of time it would be very difficult to collect the necessary evidence and even so the Inspector might not consider it sufficient, which is why the managers and advisors are advising against making the deduction.

It is therefore a situation that makes what appeared to be a sound fiscal measure not applicable in practice.

As regards deductible expenses for the usual surface of the home affected by the economic activity, it happens the same as in the previous case, with the aggravating factor that was originally intended to improve the situation of departure and the approved rule has meant a step back in the percentage of application on the total square meters of the home affected.

It is for this reason that from UPTA will request a round of meetings with parliamentary officials in the economic and fiscal area of the various political parties in order to study a legal amendment to these regulations, as well as with the Tax Administration, to learn the practical interpretation of these measures this year.

It is totally outrageous that a rule that was approved just eight months ago cannot be applied in practice or its application is even more restrictive than the previous rules. Eduardo Abad, president of UPTA, will request an urgent review of this situation, so that at the time it is modified also raises an internal circular to the officials of the tax agency and thereby end any shadow of interpretative doubt.

Freelance and entrepreneurs