New rules which came into effect in July have reduced the maximum sum which can be paid in cash for goods and services. The legislation is part of the government’s strategy to prevent and tackle tax fraud.
The previous upper limit of €2,500 has been reduced to €1,000, although this only applies to dealings with a business or a company. So if the bill for your car repair is more than €1,000, you cannot now pay this in cash. However, it does not apply to private individuals, so the private sale of a vehicle, for example, carries no limitation.
Also in July, the EC imposed a new limit of €10,000 on cash transactions, although several member countries are imposing lower limits. Greece, for example, has set its limit even lower than Spain’s at just €500.
The EC limit of €10,000 does not apply, however, to payers who are private people whose tax base is not in Spain. Offenders face a sanction of 25 per cent of the sum involved.