Spain introduces cap on cash payments

by admin
Cash paymnet limit is now in force in Spain

One thousand euros is the maximum amount you can pay in cash under the new Spanish law. The Spanish government wants to end paying in notes and coins. To this end, the new anti-fraud law approved last year has now come into force.

In addition to reducing the amount that can be paid in cash, the law also regulates the flow of cryptocurrencies. The goal is the “permanent disappearance” of the cash payment. Spain follows a line established in other European countries for some time.

Anti-fraud law

Since the entry into force of the anti-fraud law 11/2021, already published in the Government Gazette, the general limit for cash payments has been reduced from the previously established €2,500 to €1,000.

In the official state publication it is described as follows. “Transactions in which one of the intervening parties acts as an entrepreneur or professional, with an amount equal to or greater than € 1,000 or its equivalent in foreign currency, cannot be paid in cash”. When the payer is a natural person who justifies that he is not resident for tax purposes in Spain and that he is not acting as an entrepreneur or professional, “the above amount will be €10,000 or its equivalent in foreign currency.”

Cogesa Expats

This means, in general, any payment over €1,000 in a shop, shopping centre or business must be made with a debit card. The abolition of large cash payments would result in transactions being better reflected in the accounts. This makes detecting fraud easier. On the other hand, payments between private individuals residing in Spain remains at a maximum of €2,500.

According to the government, the reduction in the maximum amount is due to the good reception of the measure. It has not led to major complaints among the groups affected by it.

The European Commission agreed not to set limits on cash payments, partly because it believes this would not prevent the financing of terrorism. In addition, it would be considered a violation of the personal freedom of Europeans. Finally, its effectiveness cannot be precisely quantified. However, the European Union determined on 3 June that travellers who enter or leave the EU with €10,000 or more must declare it.

Cash payment limit in other EU-countries

Other countries of the European Union have also set a limit for cash payments. In Italy it is €2,000, reducing to €1,000 from 1 January. France meanwhile set the limit at €1,000 for residents in 2015, although non-residents can pay up to €15,000 in cash. In government offices, on the other hand, the limit is €300. Since 2014, in Belgium, a maximum of €3,000 can be paid in cash. That is double the maximum amount in Greece. In Romania, the ceiling is around €2,260. In turn, Germany does not set any limits, but people who want to pay more than €10,000 in cash must register.

Baycrest Wealth

You may also like