The year-end accounting and tax close involves more than completing journal entries and calculating a tax bill. Management needs to know which figures have been confirmed, which estimates remain open and which decisions require supporting documentation before the financial year ends. An early review helps organise the work and prevents issues from accumulating when the annual accounts are prepared.
For businesses with several companies, workplaces or information owners, a shared timetable is the starting point. Each material balance should have an owner, supporting evidence and a validation date.
What is the difference between the accounting close and the tax close?
The accounting close determines profit or loss and the financial position under the applicable accounting framework. The tax close starts from that result and examines the adjustments needed to calculate the taxable base for Spanish Corporate Income Tax. A recorded expense does not automatically become tax-deductible, and a tax difference may have different consequences depending on whether it is temporary or permanent.
It is therefore useful to work with two connected documents: a closing file supporting the balances and a tax adjustment schedule explaining the differences. If they are prepared separately, an accounting correction is more likely to be missed in the tax review.
Six checks to organise
- Banks and financing: reconcile accounts, identify outstanding items and review loans, interest and maturities.
- Customers and suppliers: check aged balances, pending credit notes, advances and invoices not yet received or issued.
- Inventory: compare stock counts with the records and document obsolescence, impairment or count differences.
- Fixed assets: check additions, disposals, the date assets became operational and depreciation policies.
- Employees: coordinate payroll, variable remuneration, outstanding obligations and their correct allocation.
- Intercompany transactions: reconcile reciprocal balances and review contracts and service allocation criteria.
Transaction cut-off: a particularly sensitive area
An invoice received in January may relate to a service delivered in December. The document date alone does not determine the financial year to which the expense belongs. The accounting team must assess accruals and retain evidence supporting the period allocation.
As an organisational example, a company could ask each department for a list of services received but not yet invoiced, supported by contracts or confirmations. This is a control measure: the specific treatment depends on the transaction and applicable rules.
How to prepare the tax review
The review should identify expenses subject to specific treatment, differences in depreciation and impairment, outstanding tax credits and related-party transactions. It is also useful to check that returns filed during the year are consistent with the final accounts.
The result should be a list of explained adjustments with their basis and documentation. A tax forecast helps with cash planning, but it does not replace the final calculation or justify claiming deductions before checking the requirements.
What management should receive
A close that supports management includes the reviewed balance sheet, income statement, open issues, tax forecast and outstanding decisions. Confirmed figures should be distinguished from estimates, with an explanation of how the latter could change.
When should you start? Before year-end, allowing time to request information and resolve discrepancies. The lead time required varies with the size of the group, its systems and the complexity of its transactions.
Can the accounts be closed without reviewing tax? Accounting work can progress, but the two reviews should be coordinated before the closing file is treated as final.
A coordinated close with your advisory firm
Adeltra connects accounting and financial advice with your company’s tax review. To organise your next year-end close, contact our team to agree the scope and information required.
Legal reference: Spanish Corporate Income Tax Law, particularly Articles 10 and 11. General information reviewed in October 2026; application depends on each company’s circumstances.