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14.1. Books and Records

Small businesses are subject to simplified accounting and reporting obligations. The simplified regime applies to businesses whose turnover does not exceed EUR 777.000 exclusive of turnover taxes with respect to traders and EUR 234.000 exclusive of turnover taxes with respect to service providers.

The following developments apply to standard taxpayers not eligible for the simplified regime.

Accounting Obligations

Standard corporate taxpayers must keep complete and regular accounting to justify the accuracy of the reported results.

The documents required are the daybook showing the operations day by day, which are carried on the –journal book and the inventory (balance sheet, income statement and notes).

There are two record keeping obligations. The Commercial Code requires businesses to keep their records for 10 years, whilst the Tax Code prescribes 6 years. Businesses may, however, need to keep records for longer than the prescribed 6 –year period if they wish to justify certain entries such as depreciation or loss carry-forwards.

Annual Income Statement

Businesses are required to report their annual income statement to the tax authorities using Forms 2031 and its annexes. The statement must be filed with the tax office where the company has its central management or, alternatively, its principal place of business.

Various reports detailing various items must, in addition, be filed. These include, among others, active and passive income reports (Forms 2050 and 2051), a depreciation overview (Form 2055), a fixed assets overview (Form 2054) and a provisions report (Form 2056). These reports should be drawn in accordance with the rules prescribed by the General Accounting Plan. They are multipurpose use and can be deposited at the Registry of the Commercial Court by persons subject to the obligation to publish annual accounts.

In addition, 10 Tables (schedules) including information for tax and statistical purposes must be prepared:

  • determination of taxable income (Table No. 2058-A);
  • losses and non-deductible provisions (Table No. 2058-B);
  • allocation of earnings and other information (Table No. 2058-C);
  • determination and allocation of gains and losses (Tables No. 2059-A 2059-D);
  • determination of the value added produced (Table No. 2059-E);
  • composition of share capital (Table No. 2059-F); and
  • subsidiaries and affiliates (Table No. 2059-G).

Furthermore, companies must produce the following four types of information in support in support of their income statement:

  • exceptions to the accounting requirements;
  • changes affecting the methods of measurement and presentation of the annual accounts;
  • accrued income and accrued expenses; and
  • income and expenses on the balance sheet under the headings "accruals".

Traders may also be required to produce, on request of the administration, the other elements of the schedule provided for in Articles 123-195R of the Commercial Code.