At Leialta, we know that a proper year-end closing doesn’t begin when the accounts are filed — it starts much earlier. That’s why performing an accounting and tax review as of 30 November has become an essential step to ensure a reliable and efficient year-end close.
Bringing this analysis forward allows you to optimise the December instalment payment, work with accurate figures before year-end, identify pending adjustments, correctly reflect the company’s economic reality and improve liquidity in the final stretch of the year.
In this alert, we explain why this review matters and what you should look at.
Why is an accounting and tax review as of November 30 so important?
The December installment payment (Form 202) for companies whose fiscal year ends on December 31 is calculated based on the tax result accumulated up to that date.
For this reason, if figures are adjusted before November 30, companies required to determine the installment payment according to the current year’s results (Article 40.3 of the Corporate Income Tax Law), whether by obligation or by opting for this method, can avoid paying more than they should.
For example, if you have accrued expenses that were not recorded before November 30, the installment payment will be calculated without considering them, increasing the amount due.
In practice:
As mentioned, reviewing and adjusting results before that date allows you to:
- Avoid overpaying in the December installment.
- Adjust pending expenses, provisions and amortizations.
- Properly reflect the economic reality and reduce tax risks.
The main objective is to avoid advancing unnecessary funds to the Administration, while also ensuring you do not underpay when mandatory positive adjustments exist, thus preventing potential risks or penalties in a future audit for having paid less than required.
Many companies end up paying an amount in December that is either higher or lower than necessary simply because they failed to review their accounting on time.
Bringing forward the accounting and tax year-end review to November
Adjustments worth reviewing before year-end:
- Expenses and accruals: pending invoices.
- Provisions and impairments: doubtful receivables, inventory valuations.
- Tax adjustments: amortization, tax loss offsets (NOLs/BINs).
With these adjustments, the accumulated tax base is reduced, preventing excessive payments. This helps preserve liquidity now and reconcile the final result in July when filing Corporate Income Tax.
It’s not about paying less, but about applying the law correctly
This is not about trying to pay less, but about ensuring the payment is correct and aligned with current regulations.
The legal framework allows for this and is part of responsible accounting and tax management. The law permits expenses and provisions to be allocated to the period in which they are actually incurred. Therefore, the goal is to align expenses and provisions with their accrual period so that results reflect the company’s true activity.
Who is affected and what regulates it?
This point does not affect all companies equally. The analysis is especially relevant for companies with turnover exceeding six million euros, as they are required to calculate the installment payment in accordance with Article 40.3 of the Corporate Income Tax Law.
In these cases, the December installment payment is determined based on the taxable base accumulated during the first eleven months of the fiscal year, applying the corresponding tax rate and offsetting negative tax bases (NOLs/BINs) within legal limits.
Reviewing and adjusting the tax result as of November 30 allows the payment to be calculated correctly, avoiding both excesses and shortages.
Adjustments and deductions to review
Before November 30, it is advisable to review several legal adjustments that directly impact the tax base:
- Provisions for doubtful receivables when legal requirements are met.
- Inventory impairments with proven loss of value.
- Amortizations according to tables and, where applicable, accelerated amortization (e.g., for small entities).
- Accrued expenses pending invoice (advisory services, utilities, insurance, etc.).
- Reserve for leveling or capitalization, where applicable.
- Offsetting NOLs/BINs within applicable limits.
All of these are legal and advisable adjustments, provided they are properly documented and applied according to current accounting and tax criteria.
Consequences of not reviewing accounts before year-end
Not reviewing accounts can lead to unnecessary costs. For example, a company can end up paying twice as much in December simply for failing to record an accrued expense on time. Additionally, failing to make adjustments when required may lead the Administration, during an audit, to determine that the company has breached accounting or tax regulations.
The consequences may involve additional assessments, interest and penalties.
At Leialta, we prioritise a documented and prudent approach: we apply each adjustment based on technical criteria and accounting evidence that supports its validity, avoiding future risks.
How we approach the accounting and tax review at Leialta
Our goal is to ensure your installment payment is accurate and technically justified. To achieve this, we work with:
- Technical and documentary analysis: we gather all evidence before recording adjustments.
- Accounting and tax criteria: we apply the principle of prudence and current regulations.
- Materiality and proportionality: we assess economic and fiscal impact.
- Transparent communication: we explain effects and alternatives to the client.
- Correct recording: we ensure each entry is properly justified.
Direct benefits of reviewing your accounts as of November 30
- You pay only what is necessary in the December installment.
- You strengthen liquidity in the last quarter.
- You avoid financing the tax authorities unnecessarily.
- You detect errors before the final year-end close.
- You reduce the risk of penalties.
- You make safe use of deductions and offsets.
At Leialta, we review your figures as of November 30 and help you optimize your December installment payment with complete security. We analyse your accounting and tax position and advise you on applicable adjustments, provisions, and offsets, backed by solid documentation and technical criteria.
Because paying taxes is mandatory—but overpaying due to lack of review or acting too late makes no sense.
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