Which Debts Are Not Cancelled Under Spain's Second Chance Law and the Limits for Hacienda and Seguridad Social

The discharge of unsatisfied liabilities (exoneración del pasivo insatisfecho), which is the legal name for debt cancellation, covers all the debts you cannot pay, except for a closed list in article 489.1 of the Ley Concursal (the Spanish Insolvency Act). Outside that list, everything is discharged: credit cards, personal loans, microloans, suppliers or whatever you owe as a guarantor for a third party or for your own company.

The 8 exceptions are explained in plain English in the table below. In addition, the judge may exceptionally declare another debt non-dischargeable if cancelling it would leave the creditor insolvent.

Two factors outside the list decide the outcome. Only what you list is cancelled: the Supreme Court (judgments 254/2026 and 260/2026, of 18 February) requires all credits to be listed and the court order to identify those discharged. And good faith: having lied when applying for a loan or having incurred debt recklessly does not leave out a specific debt; it prevents the entire discharge.

The general rule is that public credit is not discharged, with 1 exception: of the debt owed to the Agencia Tributaria (the Spanish state tax agency, AEAT), the first €5,000 is cancelled in full plus 50% of the remainder, up to a maximum of €10,000 discharged. Seguridad Social has another identical allowance, working the same way. They do not share a single cap.

The maximum is only reached if you owe €15,000 or more to that creditor. With €8,000 owed to Hacienda, €6,500 is discharged (€5,000 plus half of €3,000) and €1,500 remains; with €30,000, €10,000 is discharged and €20,000 remains.

The Supreme Court judgments of 18 February 2026 changed the calculation in 2 ways. The allowance applies to each public-law creditor separately: Agencia Tributaria, Tesorería General de la Seguridad Social (General Treasury of Social Security), town council, autonomous community (regional government). And subordinated public credit (surcharges, interest and penalties that are not very serious) is discharged in full; the cap only applies to the rest. Thus, €14,000 with Hacienda and €11,000 with Seguridad Social give €9,500 plus €8,000: €17,500 discharged, not €10,000.

The discharged amount is applied starting with the lowest-ranking credits and, within each class, the oldest ones. If you also owe a Hacienda Foral (regional tax authority in the Basque Country or Navarre), the law sets a common allowance with the Agencia Tributaria in the same proceeding. And all of this only applies to the first discharge: in subsequent ones, no public credit is cancelled at all.

Yes, in part. The wording of article 489.1.5.º only names the Agencia Tributaria and Seguridad Social, and for years it was interpreted that IBI (local property tax), vehicle tax or a regional tax assessment were never cancelled. The Supreme Court has established the opposite: partial discharge covers all public-law credit, regardless of who collects it, with a separate allowance of €5,000 in full and 50% up to €10,000 for each creditor.

It does not matter whether the town council, the provincial council (diputación) or another body collects it: what counts is the creditor that holds the debt. If what you owe your town council does not exceed €5,000 in principal, it is cancelled in full, along with its surcharges. For this, the list of creditors must separate each public authority and each item, and that is how we break it down in the application.

Surcharges, interest and financial penalties are subordinated credits, including those from Hacienda, Seguridad Social or a town council, and according to the Supreme Court that subordinated public credit is discharged in full without using up the allowance. Criminal fines and very serious administrative penalties are never cancelled, whatever their amount. A minor or serious traffic fine, applying this doctrine, is discharged; one for a very serious offence is not.

It is another matter when a penalty closes the door to the entire discharge. You cannot obtain it if, in the previous 10 years, you have been given a final penalty for a very serious tax, Seguridad Social or labour offence, unless you have paid it in full when applying. With serious offences, it only excludes you if a penalty exceeds half of the dischargeable amount before the Agencia Tributaria, also unless paid.

Transfer of liability (derivación de responsabilidad) to a company director falls under that same ground, but the Supreme Court (judgments 259, 261, 262 and 263/2026, of 18 February) only considers it an exclusion if it is proven to arise from fraudulent conduct comparable to a very serious offence.

No. Maintenance debts are not discharged: maintenance arrears remain payable after the court order and the person claiming them retains their legal actions, including enforcement. Civil liability arising from a crime (what a criminal conviction requires you to pay or return), civil liability for death or personal injury, and compensation for workplace accidents and occupational diseases are not cancelled either.

If you were an employer, wages for the last 60 days of work before the declaration of insolvency, up to 3 times the minimum wage (salario mínimo interprofesional), and those accrued during the proceeding are excluded, unless their payment was assumed by FOGASA (Spain's Wage Guarantee Fund). And the legal costs and expenses of the discharge application itself are not cancelled.

For a mortgage or other debt with collateral (garantía real), the portion covered by the value of the collateral, which the law calls the limit of special privilege, is not cancelled; anything exceeding it is. If the bank has already enforced the collateral before the discharge, only the remaining unpaid debt is cancelled.

If you keep your home under a payment plan, the maturity dates are maintained, but the instalments are recalculated on the portion that does not exceed the value of the collateral: 90% of the fair value according to a valuation by a company approved by the Bank of Spain, unless there is one from the 6 months prior to the insolvency. Any excess is treated in the plan according to its credit class, and whatever remains unpaid is discharged.

Sureties, guarantors, joint and several co-debtors, insurers and non-debtor mortgagors remain liable: the creditor can claim against them. Whatever they might claim back from you for having paid is affected in the same way as the main debt. If you acted as guarantor for your company or a relative, that debt is yours and is included. And under a community property regime (gananciales), the discharge of joint debts does not extend to your spouse unless they obtain it for themselves.

Creditors of non-dischargeable debts retain their legal actions: they can claim and enforce. Whatever remains with Hacienda and Seguridad Social can be deferred or paid in instalments as soon as the court order is issued. Managora prepares and submits this as your representative, through our specific service pages for deferrals with the Agencia Tributaria and Seguridad Social; you can see the updated fee on each page.

Not everything can be deferred. Hacienda does not defer withholdings and payments on account, nor VAT (IVA) and other passed-on taxes, unless it is proven that they were not collected. Seguridad Social does not defer the workers' contributions or contributions for workplace accidents and occupational diseases, and granting the deferral is conditional on paying these within 1 month.

There is also your credit history: the court order for discharge with liquidation, or for final discharge following a payment plan, orders creditors to notify credit reference agencies. To remove your details from ASNEF, Experian and CIRBE (Spanish credit default and risk registers), we have a dedicated service page.

We handle the insolvency and discharge from start to finish, with our own registered lawyer and procurador (court procedural representative), who are mandatory in insolvency proceedings and included in the price on the service page. We separate each debt by creditor and by item, calculate the allowance for each public authority and file it before the Commercial Section of the Court of First Instance (Sección de lo Mercantil del Tribunal de Instancia). If a public creditor objects or misapplies the cap, we reply in the ancillary insolvency proceeding (incidente concursal) and, if necessary, appeal to the Provincial Court (Audiencia Provincial).

Apart from giving us your documents, the only thing you have to do is grant the special power of attorney to the procurador: free of charge, with your DNI (Spanish national ID card) or NIE (Foreigner Identification Number), before the court clerk (letrado de la Administración de Justicia) at any court office, without a digital certificate or Cl@ve (Spain's public digital login system). We will never ask for your digital certificate or your Cl@ve. The discharge is granted by the judge after checking the requirements ex officio, even if nobody objects; our job is to ensure every debt arrives properly listed and properly calculated.