Guide to Checks: Types, Payment, and Non-Payment Procedures

Posted on Nov 3, 2024 in Law & Jurisprudence

Special Cases of Bills

Bills to one consignee may include various operations and shall be evidenced in each detail (Art. 3.1.c).
Bills may include all operations for the same recipient in a period of one calendar month or less (Art. 2.3.).
If the customer placed an advance, it must appear on the bill (Art. 3.2.).
In retail sales, passenger transport, hospitality, and recreational activities, if the amount is less than 10€, the developer may simply include VAT (Art. 4).

An original of each invoice, ticket, or voucher must be issued.
If there are multiple recipients, and the original is lost, a duplicate can be issued. This document should be marked as “duplicate”.

A copy of each invoice, ticket, or voucher issued should be retained for 6 years (from the date of expiry of the payment).
The copy can be replaced by microfilm or magnetic media.
Invoices received must be retained for the period of limitation and numbered consecutively.
Invoices for the acquisition of movable property (furniture, machinery) must be kept for 10 years after receipt.
Invoices for immovable property (buildings, land) must be retained for 15 years.

A new bill should be issued specifying the number and date of the corrected one.
Corrected bills shall have a special series numbering.
If the adjustment is due to a trading volume discount, it is not necessary to specify the corrected invoice; it is sufficient to indicate the year the discount covers.
If there are discounts or benefits to customers who are not subject to VAT, it is sufficient to issue a credit note.

Entrepreneurs and professionals subject to VAT should maintain two obligatory record books: a Record Book of invoices issued and a Record Book of invoices received, which may be digital.
Both books should include: invoice number, date, customer/supplier, nature of the transaction, tax base, tax rate, and VAT amount.

Maker: The person issuing the check from the funds they have in their bank account, using their signature.
Book: The bank or credit institution that has to pay the check upon presentation from the funds of the drawer.
Policyholder or payee: The person who is entitled to receive the check.
Endorser: The holder of a check can transfer it to third parties by endorsement, who in turn can endorse the check again.
Guarantor: A person who guarantees a check, in whole or in part, by collateral. The guarantee is made on the back of the check using the expression by endorsement and the guarantor’s signature. The simple signature of a person (except the book) serves as collateral. The guarantor incurs the same obligations as the person to whom they have endorsed the check.

Bearer: These checks bear the text Bearer, either with a payee or not, and can be cashed by whoever presents them to the bank.
To a particular person (Nominative): These checks are payable to a specific person, either natural or legal. This form allows endorsing the check by filling in the back with the formula Pay this check to yourself, signed by the endorser and the date.
To a particular person with the clause not to order or equivalent: This type differs from the previous one in that it is non-endorsable.

Checks should be paid at the place indicated opposite the name of the bank. If missing, the location of issuance is the place of payment.
Deadlines for collecting checks:
- Issued and payable in Spain: within 15 days from the date of issuance.
- Issued in Europe and payable in Spain: 20 days.
- Issued outside Europe and payable in Spain: 60 days.
Checks are payable on demand: a check submitted before the issue date will be paid on presentation.
An order not to pay a check does not apply within the deadline (except in cases of theft or loss).
If the drawer has insufficient funds, the drawee will pay the balance shown on the account, and the holder is obliged to accept it.

The policyholder must protest the check to the drawer to demand forced payment.
Objection: An action that serves to prove the drawee’s refusal to honor a check. It must be authorized by a notary and made within five days following the expiration of the check. An equivalent statement can be made by the drawee on the back of the check.
Once a check is protested, recourse may be required against the drawer, the endorsers, and other obligated parties.

Crossed Check: A check with two parallel diagonal lines drawn across its face, optionally including the name of a credit institution or the expression and company (or & Co.) between the lines. This indicates that the check can only be deposited into the payee’s account at a bank. Its main purpose is to prevent cashing by persons other than the policyholder.
- General crossed check: The drawee can pay the amount into the policyholder’s account at any bank.
- Special crossed check: The name of the specific credit institution where the check must be presented for payment is indicated between the lines.
- Crossed check for a specific person: Only the named payee can deposit the check for collection.
Conformed Check: A check marked by the bank as compliant, indicating that the funds are available and the check can be cashed. This blocks the corresponding amount in the drawer’s account until the check is cashed. Normally, a specific period is set for maintaining the block of money. This is usually recorded on the back of the check with a formula like: [Formula for confirming the check].