What is Form 123 and how to fill it in?

form 123
In this post, you will find out the definition of Form 123, the correct way to fill it in and its practical use.

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If you are a taxpayer in Spain, you may have heard of Form 123. It is the document used to declare withholdings and deductions from the income for individuals and legal entities in Spain, including non-residents. This form is essential for companies, whether large corporations or small businesses, to pay their taxes on time. In this article, we will look at what Form 123 is and how to complete it in Spain.

What is Form 123?

Form 123 is a tax return that must be completed and sent to the Tax Agency by all individuals, companies and other entities subject to Personal Income Tax (IRPF), Corporate Income Tax or Non-Resident Income Tax. The form is used to declare and pay taxes related to specific capital income or certain types of income.

Companies must file the declaration quarterly, while individuals and non-residents must file annually. The Form 123 provides the Tax Agency with detailed information on all the income obtained, deductions and withholdings.

Who must file Form 123?

Form 123 is mandatory for any natural person, legal entity or organization that must pay Personal Income Tax, Corporate Tax or Non-Resident Income Tax. This includes, among others, the self-employed, sole traders, small businesses and large corporations.

In addition, any company that has to pay dividends to its shareholders must also present Form 123.

When should Form 123 be submitted?

The deadlines for submitting Form 123 vary depending on the type of taxpayer and the amount of income obtained.

Companies and individuals with income greater than 6,010,121 euros have to submit their returns quarterly. On the other hand, those with income less than this amount have to submit it annually. All declarations must be filed within 20 days of the end of the quarter.

For non-residents, the deadline for filing Form 123 is within the first quarter of the year following the year in which the income is obtained.

How to fill in Form 123?

Form 123 consists of five parts that provide the Tax Agency with detailed information on the income, deductions and withholdings of the natural or legal person.

  • The first part includes personal and contact data, such as the name and address of the natural or legal person.
  • The second includes information about the income obtained during the quarter.
  • The third part includes information about deductions, such as tax credits and allowances.
  • The fourth part includes information related to tax withholding.
  • The fifth part includes a summary of all the information provided in the form.

To complete the form, it is necessary to have other associated forms, such as Form 115, which is used to calculate the percentage of taxes payable and Form 111, which is used to report tax withholdings.

Where to present Form 123?

It must be submitted electronically to the Spanish Tax Agency using a digital certificate. In addition, taxpayers must also make the payment through their bank account.

The form consists of five parts that provide detailed information on the income obtained, deductions and withholdings. In addition, they must be submitted within the corresponding period of 20 days for companies or one quarter for non-residents.

Do you need more information about the Tax Agency procedures?

At Entre Trámites we offer various services of management, advice, and support in bureaucratic procedures for self-employed, SMEs, and other types of companies. Contact us! Through our contact form, you can leave your details for us to call you, schedule a free consultation, or simply text our WhatsApp.

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