June marks the midpoint of the fiscal year and brings together three key milestones that are important to consider from an accounting and tax perspective. It is a crucial month both for high-net-worth individuals and for companies aiming to keep their accounting information up to date and to plan their year-end closing with confidence.
Below, we summarise the three accounting obligations for June in Spain you should not overlook during these weeks:
Form 714, wealth tax
Form 714 is one of the major tax obligations that both business owners and individuals must face. As the name suggests, it is used to declare net wealth. This form can be submitted until June 30th.
A relevant point: all individuals with a net wealth exceeding €2,000,000 are required to file Form 714. Additionally, those whose payable tax amount is not zero, after applying exemptions and allowances, must also declare it.
There are several important aspects to consider when submitting:
- All types of assets and rights must be included: real estate, vehicles, shares, investment funds, artworks, life insurance policies, etc.
- In many cases, holdings in family or business companies raise questions about their correct valuation and possible exemptions.
- It is advisable to review the applicable regional regulations, as there can be significant differences regarding exemption thresholds or tax rates.
Furthermore, accurate valuation of these assets is essential to avoid errors and subsequent issues. Particularly, shares in family or business companies often cause doubts regarding their valuation and potential exemption.
Among the most frequent errors in filing Form 714 are:
- Incorrect valuation of unlisted assets, which can lead to overpayment or underreporting of tax.
- Failure to properly consider debts linked to the assets, which are deductible and reduce the taxable base.
- Incorrect application of the family business exemption, which protects the transfer and management of companies within the family environment.
Therefore, it is recommended to carry out a detailed analysis and, in case of doubts, seek specialised tax advice to avoid mistakes that could result in penalties.
Preparation for the 2024 Income Tax campaign
Among these three accounting obligations in June, the Personal Income Tax (IRPF) filing campaign is one of the most important, and it ends on June 30th. That’s why it’s crucial to start preparing as early as possible to avoid last-minute rushes and maximize tax benefits.
Why early planning is important?
Proper preparation allows you to:
- Gather and review all necessary documentation: income certificates, proof of deductible expenses, investments, donations, etc.
- Identify potential deductions or tax benefits that may be overlooked due to lack of knowledge.
- Avoid errors or missing information that could delay submission or complicate processing.
Tips to optimise your tax return
- Review this year’s tax changes to avoid missing saving opportunities.
- Monitor possible income and expenses that could affect your taxable base.
- Consider tax strategies that help adjust declared net income without breaching regulations
Half-year closing: A key step for financial health of the business
June 30th is not only important for fulfilling tax obligations but also marks the closing of the first half of the accounting period. This closing is a fundamental tool to maintain rigorous control over the financial situation and prepare the way for the year-end closing.
Why is a proper half-year closing essential?
- It enables assessment of the company’s economic and financial performance during the first half of the year.
- It helps identify budget deviations or liquidity issues in time to correct them.
- It provides key information for strategic decision-making and tax planning.
- It aids in preparing reports and balance sheets more accurately, which enhances the confidence of investors, banks, and other stakeholders.
Aspects to review in the half-year closing
- Account reconciliation and balance verification.
- Review of provisions and contingencies.
- Evaluation of assets and liabilities.
- Management control of treasury and outstanding payments.
- Necessary accounting adjustments to reflect the economic reality.
A well-executed half-year closing facilitates more efficient management, minimises risks, and prepares the company to face the second half of the year with greater solvency and security.
June is undoubtedly a crucial period for fulfilling fiscal and accounting obligations that directly impact the financial health and strategic planning of individuals and companies.
Do not hesitate to contact us. At LEIALTA, we will provide you with personalised advice and support throughout these processes. Proper management of these three accounting obligations for June in Spain is key to ensuring the stability, competitiveness, and sustainable growth of your business or assets.
