Oddbean

I live in Spain and it is insane how much time I waste on taxes as a self employed person. Everything from social security, income tax and different fees are drowning. I pay a tax advisor for services and even with that I calculated that I have to waste at least 3 hours a week collecting paperwork. This is also not any help that the spanish tax authority is one of the most persecuting and demanding in the world.

Here's not fun story about taxes in Spain: Once, I forgot to make a quarterly income tax payment to the Spanish Tax Agency (Agencia Tributaria). They waited until I was four months in default before informing me that I had not paid. I had given them permission to deduct the amount from a specific bank account. However, I didn't have enough money in that account, so the charge failed. Since they were supposed to take it out themselves, one would think they should know instantly and notify me accordingly. But unfortunately, this was not the case... Being four months in default meant they could fine me between 10% and 20%, plus interest, on the outstanding amount. I had also given them explicit permission to communicate with me via email (by default, they can only communicate through the postal service). This situation suggests two possibilities: 1- They took four months to notice that I hadn't made a payment, then seized the opportunity to fine me. 2- They knew I was in default and waited the required three months before imposing a penalty. I will never know which scenario is true because of how incentives are aligned with tax agents in Spain; either could be possible.

A story about the Spanish tax authorities nostr:nevent1qqsrmwh029ny3sunhgzylwm2m2wjnmfcnaw3jpw4u2u0wdtkhs5jeyspp4mhxue69uhkummn9ekx7mqzyphmyesp9scqsvp72jh929qtg62haxtcpxzqrhdrfaxeyx38t0utkqcyqqqqqqghd577l

I was doing all of my businesses quarterly taxes. I hate licking envelopes, so frequently close envelopes with a glue stick. My state employment tax envelope seems to have stuck to my federal employment tax envelope. The Feds opened the envelope not addressed to them (should be mail fraud), stamped "Department of the Treasury" over the to line on the check changing who it was written to (should be check fraud) and cashed my check. A couple weeks later the state says I didn't pay my state taxes. I check and show them the cashed check. They caught that the Feds stole my check. I then contact the Feds to ask about my money and they admit they stole my money and tell me I can miss some payroll taxes because I have a credit. I don't pay one payroll's taxes, which is about 2/3 of the amount they stole still leaving me a credit. Shortly after filing my quarterly employment taxes where I have a credit and they owe me money, I receive a notice that I didn't pay my taxes and threatening fines, interest, and seizing my business. I call and spend a couple hours on the phone. They misapplied the money so it showed unpaid even though I had overpaid. They said everything was fixed. Three months later I get another nasty gram threatening to not only fine me but seize all of my assets because I didn't pay my taxes, even though they were over paid and stole my money. I called and spent several more hours on the phone. They finally said everything was fixed and I was fine. A month later I get a really threatening letter threatening to seize my assets and throw me in jail. This time I went to the local IRS office and spent hours more. They admitted that everything was their mistake, but since their system showed me being so late, I now had to show proof of employment tax payments with every payroll for a year. I think it took over 2 years to get my over payment (stolen funds) back and get back to normal. I can't even begin to tell how much I hate the IRS and taxes. They are thieves and brigands. The mafia and the mob seem like gentlemen in comparison.