The TEAC annuls a tax assessment issued before the taxpayer’s submissions were considered
The risk of tax becoming time-barred does not allow the Tax Agency to curtail a taxpayer’s right to be heard.
The Central Economic-Administrative Tribunal (TEAC) has reiterated an important rule for taxpayers under inspection: when a taxpayer files submissions within the statutory period, the Administration must examine them before issuing an assessment—even if waiting to receive them may cause the inspection to exceed its maximum duration and may ultimately affect limitation periods.
This is the rule in the TEAC resolution of 23 June 2026, case RG 5800/2023, which the Tribunal expressly identifies as doctrine. It reiterates its resolution of 25 November 2025, RG 1904/2022, and applies the Supreme Court’s judgment 1114/2023 of 12 September, appeal 3720/2019, ECLI:ES:TS:2023:3639.
The Tax Agency cannot rush to avoid limitation at the expense of the taxpayer’s right to have their submissions genuinely considered.
A tax case involving more than €11.8 million
The dates and amounts in the case illustrate the issue. The Inspection issued a notice of disagreement on 9 August 2019, notified on 12 August. The proposed tax debt was €11,845,099.55: €9,653,954.06 in tax and €2,191,145.49 in late-payment interest.
The proceedings concerned several personal income tax years and, among other matters, foreign assets (Form 720), investment income, tax residence and employment income. This was not a minor dispute or a merely formal set of submissions.
The taxpayer had 15 days to make submissions
Article 157(3) of the General Tax Law (LGT) gives a taxpayer 15 days to make submissions to the competent assessment body after a notice of disagreement. Article 157(5) then provides that, once the submissions have been received, that body issues the appropriate assessment.
In this case, the 15 working days expired on 3 September 2019. On 27 August, the taxpayer had requested an extension because of the complexity of the file. The Tax Agency refused it, expressly citing, among other reasons, the risk that its power to assess might become time-barred if the proceedings continued.
The submissions were filed on the final day
The taxpayer used the full period allowed by law. On 3 September 2019, the last day, the submissions were filed at a post office and correctly addressed to the Inspection body. Filing in this way was legally valid, but the documents did not reach the Tax Agency’s registry in Santa Cruz de Tenerife until several days later.
The Tax Agency did not wait. On 4 September 2019, one day after the submission period ended, it issued and notified the assessment. The taxpayer had filed on time, but the Inspection had not yet physically received the submissions and therefore had not assessed them.
Why was the Tax Agency in such a hurry?
The TEAC states that the maximum duration of the inspection was 27 months and, using the start date considered by the Inspection, would expire on 5 September 2019. The assessment was issued the day before.
There was also a dispute about a possible three-month extension because the taxpayer had supplied documents late, which would have moved the expiry date to 5 December 2019. The TEAC considered it reasonable that the Tax Agency had acted cautiously on the assumption that the extension might later be challenged. Its refusal to extend the submissions period had itself referred to the risk of limitation.
The Administration tried to protect itself against that risk by assessing immediately. The TEAC’s ruling sets the limit on that approach.
The taxpayer may use the entire filing period
The Tribunal rejects any suggestion that the taxpayer acted improperly by waiting until the final day. If the law grants 15 days, the fifteenth day is part of the period just as much as the first.
- The taxpayer is not required to make submissions earlier.
- They need not voluntarily give up part of the period.
- They do not have to help the Tax Agency finish its proceedings on time.
- They cannot be disadvantaged for exercising a right granted by law.
The Supreme Court made the same point in its judgment of 12 September 2023 in the Ferrovial case. There, too, submissions were sent by post on the final day, and the Court rejected the idea that using the full period could be held against the taxpayer.
The submissions stage must be effective, not merely formal
This is the core of the doctrine. Granting a period for submissions means more than allowing a taxpayer to file a document. The decision-making body must also receive and consider the submissions before it decides. Otherwise, the process is an empty formality.
Article 157(5) LGT provides that the competent body issues the assessment after receiving the submissions. If the Tax Agency formally grants 15 days but issues its assessment immediately afterwards without allowing time for submissions validly filed during that period to reach the decision-maker, the right of defence is compromised.
In this case the TEAC found actual and effective prejudice to the taxpayer’s defence, rather than a harmless procedural irregularity.
The Tax Agency must allow a reasonable time
What if submissions are filed through a lawful channel but take several days to reach the decision-making body? Neither the LGT nor administrative procedure legislation sets a precise number of days the Tax Agency must wait. The Supreme Court has nevertheless held that the principle of good administration and the logic of the proceedings require a reasonable margin.
There is no automatic rule requiring the Agency to wait three or five days; the answer depends on the circumstances. But deciding the day after the filing period ends is difficult to reconcile with the right of defence when the taxpayer could still have filed validly through an authorised channel.
What if waiting means the inspection exceeds its time limit?
This is the most significant question in the resolution. The TEAC’s answer is clear: the Tax Agency must still wait for and consider the submissions.
The Tribunal’s published criterion states that filing on the final day does not justify issuing an assessment without considering the submissions, even if this means exceeding the inspection’s maximum duration and may lead to limitation. The risk of limitation is a consequence of how the Administration manages its own proceedings; it cannot be shifted to the taxpayer.
After months—or, as here, a procedure lasting up to 27 months—the Administration must organise its work so there is time at the end to respect the hearing and submissions stages. The Inspection’s time pressure at the end of a procedure cannot be relied on against the taxpayer.
What happens when the maximum inspection period is exceeded
Article 150 LGT sets out important consequences when an inspection exceeds its maximum duration. The procedure does not automatically lapse and may continue. However, the inspection steps taken before the deadline lose their interruptive effect on limitation for the tax obligations still to be assessed, subject to the statutory rules.
As a result, by the time a valid assessment is eventually issued, the Tax Agency’s right to assess some years may have become time-barred. The end date of an inspection can therefore determine whether the debt may still be assessed.
The Tax Agency cannot choose between the right of defence and avoiding limitation
The Administration may face a choice: wait to receive and examine the submissions and risk exceeding the maximum period, or issue the assessment immediately to finish on time without having seen them. The TEAC rules out the second option.
The taxpayer’s right of defence cannot depend on how much time the Tax Agency has left to complete its inspection. As the Supreme Court has said, the effectiveness of the submissions stage cannot be left to the Administration’s discretion based on whether limitation is at risk.
This is not a question of “courtesy”
The Supreme Court’s 2023 judgment is particularly clear on this point. The National Court had suggested that basic courtesy would have recommended waiting before deciding. The Supreme Court rejected that approach: this is a requirement of law, not administrative courtesy.
The right to make submissions is part of the right to due administrative process and is directly connected with the right of defence and the principle of good administration. It is not enough to say that the Tax Agency formally granted the period; the question is whether submissions filed within it were actually considered before assessment.
Regular use of electronic channels does not change the result
There was another relevant circumstance in the 2026 case: the taxpayer had usually dealt with the Tax Agency electronically. The regional tribunal (TEAR) initially considered that the Inspection could assume that submissions had not been filed because none appeared electronically.
The TEAC rejected that reasoning. Habitually using one channel does not remove the taxpayer’s right to use other legally permitted filing methods. The taxpayer had also recently requested an extension, showing an intention to make submissions and use the time available.
What did the TEAC decide?
The TEAC upheld the appeal and annulled the assessment. It found actual and effective prejudice because submissions validly filed within the deadline had not been considered before the decision.
An important qualification is needed: this ruling does not mean that every failure to consider submissions automatically makes the tax debt time-barred. Limitation depends on the tax years concerned, the start date, the applicable maximum period, any extensions or suspensions, later acts capable of interrupting limitation, and the date on which a valid assessment is issued and notified.
The doctrine is that the Tax Agency cannot avoid the possible consequences of limitation by assessing before considering submissions validly filed on time.
A doctrine that is beginning to take shape
The TEAC’s resolution of 23 June 2026 is not isolated. It expressly reiterates its resolution of 25 November 2025, RG 1904/2022, and both rely on Supreme Court judgment 1114/2023 of 12 September in the Ferrovial case.
The line of authority is clear: the submissions stage must be effective, and the Administration must organise its proceedings so it can respect that right without transferring the consequences of its own lack of time to the taxpayer.
Practical consequences for ongoing inspections
Inspection files should be reviewed carefully where an assessment was issued close to the maximum time limit. Particular attention is warranted where:
- Submissions were filed on the final day.
- The Tax Agency assessed the next day or only a few days later.
- The submissions do not appear to have been answered.
- An extension was refused because of a risk of limitation.
- The maximum duration of the procedure is disputed.
- The inspection was approaching 18 or 27 months.
- Older tax years might have become time-barred if the maximum period was exceeded.
In such cases, the dates in the file can be as important as the underlying tax dispute.
Review the assessment before debating the tax treatment
When reviewing an assessment, a tax adviser should examine not only whether the Tax Agency’s interpretation is correct, whether income was calculated properly, whether expenses are deductible, whether there was simulation, or whether the law was applied correctly. The procedural chronology should also be reconstructed.
A seemingly secondary procedural issue can lead to the annulment of a very large assessment. Check the inspection start date, applicable maximum period, suspensions and extensions, date and notification of the inspection report, start and end of the submissions period, filing date and method, date received by the Tax Agency, date of the assessment and notification, and the Agency’s response to the submissions. Procedure is part of tax legality.
Conclusion
The TEAC’s resolution of 23 June 2026 provides an important safeguard where an inspection reaches the end of its time limit in a rush. A taxpayer is entitled to use the entire statutory period for submissions, including the final day. The Tax Agency must ensure those submissions can fulfil their purpose: being considered before the final decision.
If the Administration has managed its procedure so that waiting for submissions puts the inspection deadline at risk, that cannot prejudice the taxpayer. Exceeding the deadline may cause inspection steps to lose their interruptive effect and, depending on the file’s dates, may lead to limitation for some tax years.
The Tax Agency cannot avoid possible limitation by sacrificing the taxpayer’s right of defence. If submissions are filed on time, it must hear them—even when the clock is running against it.
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