How will 232,000 debtors regain their lost arrangements

by Dimitris Papadopoulos

232,000 State debtors whose arrangements they were subject to are “frozen” have a 10-day deadline. With the changes coming to the Code of Tax Procedures, they are given the possibility to rejoin under conditions. Until the provisions of the new tax law are published in the “Government Gazette”, they should pay all the monthly installments they left unpaid. Based on the new regulation, the reinstatement concerns old regulations of 72, 100 or 120 doses or the permanent regulation of 24 or 48 doses which are in gray zone. Based on the new law, reintegration concerns those who:

– They did not pay two or more monthly installments of the arrangement on time, either due to an inability or an error of the system, which did not recognize a payment as on time.

– They did not submit income tax and VAT returns during the period when the regulation was active.

– They created new debts, as they did not pay the current debts or did not service another arrangement in which they had joined.

The amounts they pay will initially appear as “overpayments” – “tax refunds” in their myAADE accounts. AADE will then proceed to offset these payments with the unpaid balances of the “frozen” arrangements. As long as these payments cover all overdue installments, the arrangements will be re-activated for the specific debtors, i.e. the debtors will be immediately re-integrated into the lost arrangements.

As reported by the Ministry of Finance, the changes clarify the regime for the arrangements of confirmed debts to the Tax Administration, in order to strengthen legal certainty and in order to deal with practical obstacles that have arisen, for the benefit of both taxpayers and the Administration. In addition, specific issues concerning the conditions for loss of settings are regulated, depending on each case and category of setting. In particular, the aim is to prevent the loss of a large number of arrangements, which on the one hand are particularly favorable for debtors and on the other hand have a high rate of collection, with a positive impact on the revenues of the State Budget.

The process

On the “Arrangements with Overdue Installments” platform (https://www.aade.gr/rythmiseis-me-anexoflites-ekprothesmes-doseis) taxpayers can be informed about:

– The unpaid overdue installments of the arrangements that can be included in the process of credits and offsets with payments and tax refunds.

– The pending refunds, as well as the payments for which AADE has been informed until 4/15/2024.

– The amount they must pay by the entry into force of the law “Sanction of the Code of Tax Procedure and other provisions” to cover the unpaid arrears.

Interest – surcharges

Outstanding amounts are charged with interest and late payment surcharges. They will be charged monthly late payment interest of 0.73% on the overdue principal amount for each month in arrears until today – or until the last installment of the arrangement if its payment deadline has now passed. Also, a surcharge is calculated on the last or two last installments of the arrangement (depending on its type, 24/48 installments, 36/72 installments, 100 installments, 120 installments, etc.).

After crediting payments and any outstanding refunds:

– As long as all overdue installments of the arrangements are settled, the arrangement is now considered serviced and will not lead to a loss.

– As long as part of the overdue installments of the arrangements are settled, a loss occurs for the remaining part of them.

The loss of settings will now be done automatically centrally for everyone and not by the DOU of each debtor, so that there will be no repetition of such problems in the future.

The latest figures from AADE show that, of the 106.3 billion euros of the overdue balance, only 4.6% or 4.611 billion euros have been included in some arrangement scheme. Of the debtors who have entered into an arrangement, 7 out of 10 have debts up to 300,000 euros and have settled debts of 3.24 billion euros, while debts of more than 300,000 euros account for 29.6% of the settled balance, i.e. 1.368 billion . euro.

At the same time, with the new provisions of the Tax Procedure Code, the regulation will not be lost within 24 hours. On the contrary, a leeway of 3 months is given for the submission of income tax and VAT returns from the expiry of the deadline for their submission and for the payment or settlement of new debts from the expiry of their payment deadline.

As the Minister of National Economy and Finance mentioned, “today the non-submission of the prescribed income tax and VAT declarations or the delay in submitting them even for one day results in the loss of arrangements for other debts. The same applies to any new overdue debts, which, if created for even one day, result in the loss of the arrangement. This ceases to be valid. We give the possibility of payment and settlement of the debts outside the arrangement, in order to avoid the loss of the arrangement”.