Marina Escalada
TAX LAW DIVISION
When a company encounters financial difficulties, its directors tend to focus on the immediate future: urgent payments, suppliers, employees, banks, insolvency proceedings, and whether the business can continue operating. However, the real problem sometimes arises years later, when the company can no longer pay its debts and the Tax Authority seeks to recover the tax debt from the person who once served as its director.
This is what happens in cases of secondary tax liability. The General Tax Law allows certain tax debts to be claimed from de facto or de jure directors when the legal requirements are met, particularly where the company has committed tax infringements and the director failed to act with the required diligence. Since this is a form of secondary liability, however, the Administration must first declare the principal debtor insolvent—that is, formally establish the company’s inability to pay.
The recent Supreme Court Judgment No. 545/2026 of 30 April introduces an important limitation on this practice. The case concerned a Valencian company, Mitsi Shop, S.L., which had entered insolvency proceedings. In September 2014, the insolvency administrator submitted a provisional report stating that the company was insolvent, unviable, and should be liquidated. According to the judgment, this report was known to the Tax Authority.
Despite this, the Tax Authority did not formally declare the company insolvent until September 2018 and did not notify the former director of the commencement of secondary liability proceedings until July 2019. More than four years had passed between the point at which the company’s insolvency had been objectively established and the initiation of proceedings against the director.
The issue was simple to formulate but highly significant in practice: Can the Tax Authority delay the formal declaration of insolvency and thereby postpone the commencement of the limitation period?
The Supreme Court’s answer is no.
The key concept is the doctrine of actio nata, namely, the moment at which a legal action can first be exercised. In this context, the Court held that the limitation period for attributing liability does not necessarily begin when the Tax Authority formally issues the insolvency declaration, but rather when the principal debtor’s insolvency has already been sufficiently established through objective evidence arising from the insolvency proceedings.
Put simply: the clock starts running when the Administration is able to act, not when it chooses to act.
This clarification changes the approach to many cases. Until now, the Administration could argue that the limitation period did not begin until the formal declaration of insolvency. The problem with that interpretation is obvious: it effectively allowed the Tax Authority itself to determine the starting point of the limitation period. By delaying the insolvency declaration, it could also delay the commencement of the prescription period.
The Supreme Court prevents this outcome by linking the calculation of the limitation period to the moment when the insolvency was already known, objective, and sufficiently verified.
The judgment does not prevent the Tax Authority from pursuing directors where the legal requirements for secondary liability are met. Nor does it diminish the duty of directors to ensure compliance with tax obligations. What it does make clear is that the Administration’s collection powers are not unlimited in time. The Administration may act, but it must do so within the applicable time limits and from the moment it was legally in a position to act.
In this respect, the doctrine established by the Supreme Court reinforces a fundamental principle of tax liability law: the declaration of insolvency cannot be used as a tool to artificially postpone the start of the limitation period. If the insolvency was already known and objectively established, time begins to run.
Ultimately, the secondary liability of company directors cannot become an indefinite threat. The Tax Authority may pursue recovery, but it too can be late. And once the Administration was already able to act, the rules on limitation periods apply against it as well.
