February is the month in which all operations carried out with third parties are declared. This procedure, included in form 347, mainly affects self-employed persons.
So that you can fully understand what it consists of, we have created a small guide to the form. We will explain what it consists of and you will be able to find out whether or not you should file it, how to fill it in and the deadlines it has.
What is form 347?
Form 347 is an annual tax return that lists all the operations that a person or company has carried out with entities and/or suppliers, i.e. with third parties. There is only one condition: the total of these transactions must exceed €3,005.06 per year (including VAT).
Not only the customer, but also the supplier must, by law, file the form with the tax authorities. This is the Public Administration’s way of cross-checking data and ensuring that both operations (both company and supplier) have carried out the procedure correctly. There may be a small correlation error if any of the documents are registered in a quarterly period other than the one in which the supplier issued the document.
The mission of Form 347 is the same: to ensure that the information provided by both sides is correct and true. If the figures provided by the taxpayers do not match, the Tax Agency will investigate the reasons and reach an agreement or a fine. So that this never happens, let’s look at the operations that are declared on this form:
- Deliveries and acquisitions of goods and services. This section includes both those subject to and not exempt from VAT and those not subject to and exempt from VAT. In 2014 it was approved that all acquisitions of goods and services made outside professional or business activities would also be declared. However, only for private establishments of a social nature and homeowners’ associations.
- Real estate transactions.
- Subsidies and grants (without reimbursement).
- Insurance company transactions.
- Advances from customers and suppliers.
- Leases not subject to withholding (these are declared on form 180).
There are penalties for not filing form 347 if, due to the conditions you have as a self-employed person, you are obliged to file it. The fine is usually between €300 and €20,000, depending on the amount of money not declared. The calculation is based on €20 for each piece of data or set of data referring to a person or entity in accordance with articles 93 and 94 of the General Tax Law.
Who must file the form?
Form 347, which is used to declare transactions with third parties, must be filed by all self-employed persons and/or companies (public or private) which, as we have mentioned, invoice transactions for an amount greater than €3,005.06 per year.
If they exceed the established limit, homeowners’ associations must also file the form. This situation may be exceeded by the rental of a property belonging to the community (premises or storage room) or by the contracting of an external service. If, for example, the amount is €2,500, the 21% VAT will be €525. As the sum of both amounts exceeds the limit of €3,005.06, the form would have to be submitted.
The self-employed SMEs that are exempt from filing are:
- Those who have carried out operations of this type, but whose total amount does not reach €3,005.06 per year. If there are cases of collection on behalf of third parties of professional fees, rights derived from intellectual, industrial or copyright property or others on behalf of their partners, associates or members, the amount drops to 300.51 €.
- Persons who do not have a tax domicile, permanent establishment or place of business in Spain.
- Individuals or entities under the income attribution system who pay personal income tax under the objective assessment method and under the simplified VAT system of the simplified, agriculture, livestock and fishing or equivalence surcharge systems.
- Persons who have carried out transactions not subject to this obligation in accordance with article 33.2 of Royal Decree 1065/2007.
- Taxpayers who must report on transactions included in the VAT registration books (article 36 of Royal Decree 1065/2007).
Deadlines for submission
The Tax Agency’s electronic headquarters explains that February continues to be the filing date for the previous year’s tax year. The deadline is open throughout the month, and the last day of February is the deadline for filing.
All self-employed workers and/or SMEs will have to file the tax return electronically at the Tax Agency’s electronic headquarters using a digital certificate, electronic ID card or PIN code. We recommend that, if you have to file this form, you use the help of professional administrative services so that they are the ones to keep up to date with all these matters.
The type of document to be uploaded to the electronic office must be in ‘TXT’ format. The AEAT website allows you to download the document. This is where the ‘TXT’ must be uploaded.
How to fill in form 347
Before we begin to explain how to fill in form 347, it is necessary to repeat once again how important it is for the self-employed person to confirm and check with their customers and suppliers the amounts that each one has accounted for. Remember that they must always match unless the invoice is received in a different quarterly period to the one in which it was issued. This is the only case that justifies the transaction.
The form for form 347 is structured in 3 pages:
Summary of data. This section identifies the declarant, the fiscal year, whether it is a complementary or substitute return, the date and the signature. The bulk of the sheet appears in the ‘Summary of data’ section. There you will see 4 boxes:
- Box 01. These are the number of customers and suppliers with whom the declarant has carried out transactions for a value greater than €3,005.06.
- Box 02. This shows the total amount of the transactions that have been carried out with customers and suppliers in box 01 (with VAT).
- Box 03. This includes all the declarant’s business premises.
- Box 04. Refers to the amount of money for the rent of the business premises specified in the previous box (with VAT).
List of declarants. This page contains information on the clients and suppliers with whom the self-employed person or company has carried out operations whose total sum is greater than 3,005.06 €. All data collected is broken down on a quarterly basis and the calculation of the volume of transactions is carried out in accordance with VAT law. Normally, the date of accrual of VAT marks each quarter.
Each transaction with third parties must state the VAT number, the name or company name, the province, the annual amount of the transactions and the type of transaction (keys A to G), among other things. Generally they will be an A or B, but there are more, which you should indicate if they are your case:
- Key A: purchases made from suppliers.
- Key B: sales made to customers.
- Key C: collections on behalf of third parties exceeding €300.51.
- Key D: acquisitions separated from the business activity by Public Entities.
- Key E: subsidies or grants (the Public Administration is the one that marks it).
- Key F: sales by travel agencies.
- Key G: purchases of travel agencies.
List of properties. Only business premises rented for an amount greater than 3,005,06 € appear here. As in the previous section, you have to specify the tenant’s NIF, the business name, the amount of the rent or the address of the premises that have been rented.
How to modify form 347 filed?
Let’s put ourselves in a situation: you have just filed the form but you have discovered an error and you need to upload it again. Is it possible? Yes, and to do so you have to go to the Tax Agency’s 347 form page and go to the section ‘queries and modifications of declarations’.
Once you are there, select ‘companies and professionals’ and identify yourself with your electronic certificate or PIN code. Next, choose the tax year you need to modify. You will only be able to change files with ‘Correct’ or ‘with anomalies’ status, so you will not be able to touch any that are ‘under review’ or ‘being processed’.
When you log in, choose the file to be modified by clicking on the column ‘justification’ and select the number. The services available to you include:
Detailed consultation of anomalies. You can view a PDF file showing the anomalies in the declaration.
Modify detailed records. This option allows you to modify type 2 records.
Modify summary sheet. You can make changes to the summary sheet of form 347.
Delete detail record. Eliminates the records included in the return.
Add detail record. Add a new record.
If, after making the relevant modifications, the 347 form is submitted before the tax authorities ask for it again (so it is understood that this has been done voluntarily), the penalty is reduced by half for all the amounts defined above.
We hope you have understood what this form consists of and why you have to fill it in. If you have any other questions, you can consult our tax calendar for companies and the self-employed 2023 or contact us. At Blegal we offer you a professional, well-trained and diverse team that works closely together to provide you with the help you need.
Photo by John Schnobrich on Unsplash.
