Tax Obligations: Concepts, Principles, and Types
Tax Obligations: The Basics
Concept and Nature of the Obligation. The tax is established in our system as an obligation, a legal relationship where a creditor can demand a specific benefit from a debtor. Traditionally, the charge has been defined in two ways: as a coercive provision and as an obligation.
The Link to Tax Law The concept of duty, as a mandatory relationship binding the State (creditor) and the taxpayer (debtor), converges with two basic ideas: the separation of powers, which distinguishes between the abstract level of taxation and the specific level of its application, and the legal relationship between two parties where one (creditor) requires a provision from the other (debtor). The various links and relationships surrounding a tax liability can be understood as part of a complex legal relationship called juridical taxation.
The Unavailability of Tax Credit The government is obligated to collect taxes and cannot waive this requirement. It cannot accept changes in the taxpayer’s position or alter the tax obligation. Agreements for private purposes do not apply to tax matters.
Principles of Implementation of the Tax System
- Principles of Management: Affect the timing of the system and revolve around the ability to pay.
- Principles of Implementation: Emphasize the reduction of indirect taxes.
A complete tribute is an obligation to give a sum of money. The tax is an obligation ex lege, established by Law. The law determines when, how, and who should pay. The tax is an obligation of public law established for a public body. The creditor is a public entity, granting more extensive powers. The public agency pursues a public interest, implying the principles of unavailability of tax credit and non-discretionary action.
Tax Obligations: Detailed Analysis
I. Introduction.
The main tax liability is the obligation to pay the state or other public entity an amount of money in taxes, arising from taxable transactions. Tax law ensures that the amount due is paid. This liability is surrounded by various links and relationships, forming a complex legal relationship known as juridical and tax. The tax liability is the core of this relationship. The tax law relationship is a set of links and relationships that form an independent unit, with the principal tax liability as its core. This relationship includes obligations, duties, rights, and powers arising from the application of taxes, including material and formal obligations and tax penalties for noncompliance.
Classes The main obligation relates to the principal object of the agreement, while the accessory obligation is a consequence of the principal one. Other obligations include:
- The taxpayer’s obligation to make payments on account.
- The obligation of a retainer or substitute to make payments on account.
- The obligation of a person paying tribute passively.
- Obligations resulting from guarantees.
Besides the main tax liability, the system establishes ancillary obligations, such as:
- The obligation to pay default interest.
- The obligation to pay surcharges.
- The obligation to pay penalties.
These differ from tax obligations in that the benefit payable is not a tribute but rather a repair, prevention, or refund. The tax liability is the principal obligation arising from the taxable event. The tax law establishes and regulates other obligations that are subsidiaries or ancillary to the principal tax liability.
Concept and Features The main tax liability is the obligation to give a sum of money, established by law under the principle of capacity for a public body to sustain its expenses. It provides financial resources to the state, enabling it to meet its needs. This liability is a legal instrument for distributing public burdens among citizens according to their economic capacity.
Birth The tax liability arises from the law, linked to the attainment of a certain event. The law obligates certain persons to pay tribute to the state upon the occurrence of specific facts.
Chargeable Event and Chargeability The duty is payable when the taxable event occurs. However, the enforceability of the obligation may be shifted to a later time.
The Taxable Event. Functions or features of the taxable event:
- Generates the birth of the tax liability.
- Entitles the law to demand the tribute.
- Subjects a person to the payment of tribute.
Setting Different Taxes The taxable event distinguishes different tax categories, rates, contributions, and taxes. Each is different because its taxable event is different.
Economic Capacity Index The taxable event substantiates the charge by manifesting economic capacity, legitimizing the administration to demand payment. Economic strength is generally accepted as the possession of wealth, which can be property or income.
Component parts of the taxable event
- Objective or material element: An event in itself, isolated from any personal attachment.
- Subjective element: The link between a person and the objective element, determining that person’s tax liability.
Elements
- Material Aspect
- Objectives: The fact itself.
- Temporal aspect: The time when the taxable event is considered to have occurred.
- Spatial aspect: The place where the taxable event occurred.
- Quantitative aspect: Standards that quantify the tribute.
- Subjective elements: The taxpayer and the person who pays (if different).
Legal Theory of Tax Exemption The exemption as a legal institution and not a privilege An exemption occurs when a fact or situation that falls within the taxable event does not generate an obligation to pay a tax. Exemptions are not tax privileges but are necessary to perfect the principle of economic capacity and comply with the principle of equality.
Exemption: Leaving certain situations without charge. It is not a privilege, determined by the Spanish parliament. Example: those who earn less than 12000 per year are not taxed.
Buy tax and constitutional principles: the principle of legality Exemptions are established by law. The Constitutional Court stated that any suspension or modification must be made by law.
The distinction between exempt and non-subject The law may delimit the taxable event by reference to non-taxable cases. When all elements of fact are given, it is a taxable event. When not all elements are given, it is a non-taxable event. When all elements are given, but the law binds no tax liability, it is an exemption.
Economic Capacity Principle: If the chargeable event does not have sufficient financial capacity, the legislature may make exemptions.
Principle of Equality. To satisfy equality, unequal treatment is made. Exemptions from the law are applied unevenly.
Exemptions
- Objective exemptions: Concern the fact itself.
- Subjective exemptions: Concern the subject of the tax.
Tax Obligations II
The tax liability to make payments on account of the principal tax liability (advance tax). Concept, nature and classes. The tax liability to make payments on account is to satisfy an amount to the tax authority by the person liable to make payments in installments. Advance taxes are not exactly a tribute but an advance. Enforceability: payment must be paid. Meritación: birth of the principal tax liability. Illusion financial: taxes are required in a psychological way so that the taxpayer has the feeling that you pay less.
The nature of the advance tax is a special tax obligation. Classes:
- Indirect: Deductions and Income on account.
- Direct: Payment in installments or payments.
ADVANCES INDIRECT
Withholding According to LGT, the retainer is the person or entity that must remove and enter the tax authorities a portion of the tax amount when making payments to other tax liabilities. The obligation requires two circumstances: the obligation to bear the withholding and the obligation to withhold and deposit the amount. The retainer is independent of the tax liability but not independent of it. The state needs continued revenue streams and requires that citizens bring forward payments on account. This ensures the payment of tribute and guarantees the principal tax liability.
Income on account When the payment is made in kind, the law may replace the obligation to withhold with the obligation to make a payment on account.
ADVANCE DIRECT: payments or installments The state needs continued revenue streams and needs to facilitate and ensure payment of taxes, thus the need for taxpayers to overtake the annual payment by periodic payments on account. Law professionals and individuals engaged in business activities make payments on account of the principal tax liability.
The obligations arising from private tribute are economic ties between citizens or companies arising from the mechanics of certain taxes. These relationships have a public impact, allowing a person who disagrees with the amount required to make a financial-administrative claim.
The incidental tax liabilities are obligations other than those incidental to the tax, consisting of cash benefits that must satisfy the tax authorities. They include interest on arrears, surcharges, and penalties. Interest on late payment is an ancillary service required following a late payment or submission of a self-assessment. Surcharge on earnings at that late are penalty charges for untimely declaration. Surcharge of constraint is for cases where the Administration settled the debt and it was not paid.
The formal tax obligations do not involve payment but lie in performing a duty. They include the obligation to inform and assist managers, provide information on the processing status, issue copies of documents, and receive arguments and documents.
The obligations and duties of economic content of the Administration The Administration must return improperly made payments, including interest. Returns are made in accordance with each tax legislation. Interest is paid if a refund is not ordered within six months. Recovery of sums paid includes interest from the date of improper admission. Reimbursement of cost of guarantees is possible if a taxpayer wins a lawsuit. The reimbursement of advance tax may be temporary or permanent.