Revocation of the NIF for dormant companies

Important new developments in the consequences of the revocation of the NIF of a dormant company.

Law 11/2021, of 9 July, “Anti-Fraud Law”, has established important modifications in the revocation of the Tax Identification Number (NIF) for companies that do not have an economic activity.

The aforementioned Law has established a series of measures to make the civil life of inactive companies with revoked TINs impossible. It should be remembered that the Tax Administration can revoke the NIF of a company mainly for the following reasons:

• When the entity’s tax debts to the State Treasury are declared bankrupt.
• When the entity has not filed a corporate income tax return for three consecutive tax periods.
• When for a period of more than one year and after at least three attempts at notification, it has been impossible to notify the company at its tax domicile.
• When, by means of a census declaration, the tax authorities have been informed of the development of non-existent economic activities.
• When the company has been set up by one or more founders without the commencement of economic activity within three months of the application for the tax identification number or the commencement of the acts that are normally preparatory to the effective exercise of the same.
• When it is established that the same capital has been used to set up a number of companies, so that, from the overall consideration of all of them, it can be deduced that the minimum payment required by law has not been made.
• When it is reported that economic activities, administrative management or business management are being carried out at an apparent or false address, without any justification being provided for the performance of such activities or actions at a different address.

The new legislation establishes that the publication of the revocation of the NIF in the “Official State Gazette” (BOE) entails the loss of validity for identification purposes of the NIF. In addition, this publication means that credit institutions may not debit or credit bank accounts or deposits held by companies with a revoked NIF.

Publication in the BOE will also prevent any notary from authorising a deed for a company with a revoked TIN. Therefore, no entries can be made in any public register (including those of an administrative nature).

To this end, the Law provides for the creation of an automated information supply system between the notary’s office and the AEAT so that the notary can check whether the NIF of an entity has been revoked before authorising a deed.

The public register in which the entity with a revoked tax identification number is registered will issue a marginal note on the page open to that entity, stating that no registration affecting that entity may be made in the future, unless the tax identification number is reinstated.

All certifications issued by the public registers will state that the entity’s TIN has been revoked.

is it possible to recover a revoked TIN?

Yes, revocation of a company’s NIF does not have to be irreversible. Article 147.8 of the General Regulations on tax management and inspection actions and procedures establishes that the Tax Administration, at the request of the interested party, may reinstate the NIF by means of an agreement that will be published in the BOE and notified to the interested party.

Applications for the reinstatement of the NIF are only processed if it is accredited that the causes for the revocation have disappeared.

In addition, for companies, it is necessary to communicate who owns the capital of the company (with full identification of their legal representatives), the tax domicile of the entity and provide documentation that accredits the economic activity that the company is going to carry out.

If these requirements are not met, applications will not be processed.