Who will the IRS go after if the business closed, merged or the recipient passed away
All co-obligors will be pursued by the Tax Office, in order to get back the Refundable Advance, in the event that the business that received financial support during the pandemic closed, merged or the recipient passed away.
In order to ensure that the State will not lose the “clipped” amounts of up to 70% that the recipients of the Refund are required to return in up to 96 installments, a provision was forwarded to the Parliament (in the bill for the introduction of an additional tax of 15% on the profits of multinationals ), according to which a specific procedure is provided in the case of events that make it impossible to collect the amount from the beneficiary.
It becomes clear that once the debt has been confirmed at the Tax Office, the debt is inherited to co-obligors, while if the company was acquired or merged, the successor scheme also bears the responsibility of paying the refundable part of the aid which was an “injection” of survival for 700,000 companies and freelancers during the difficult period of the pandemic.
It is recalled that after successive “haircuts” from the 8.7 billion euros of total aid, the refunds to the State were limited to 3 billion euros with the possibility of either a one-time payment or in installments. In other words, approximately 5.5 billion euros were effectively a state subsidy, the cost of which was borne by the budget.
According to the provision, the TIN of a natural person who has died, as well as of a legal person or legal entity that has been dissolved or completed liquidation or deleted from the General Commercial Register, is used:
For the confirmation of the refundable amount of aid in the form of a refundable advance, which was granted,
- for the certification of the unduly paid amount of the aid,
- for the certification of the legal interest on the amounts,
- of the financial penalties for non-compliance with the conditions of the aid granted as well as:
- for the collection of the refundable amount.
It is specifically clarified that the persons with qualities such as:
executive presidents, directors, general managers, managers, managing directors, management representatives and liquidators of legal persons and legal entities, as well as the persons who in fact exercise the management or administration of a legal person or legal entity.
These are essentially the persons who are also responsible for the payment of income tax, withholding tax, any imputed tax, VAT. and of ENFIA, owed by these legal persons and legal entities, regardless of the time of their certification, as well as for interest, fines, surcharges and any administrative monetary penalties imposed on them.
The provisions are valid for certifications carried out from 1 January 2023 onwards.
