The Second Chance Law after February 2026 — how much tax and Social Security debt can actually be cancelled

Spain's insolvency statistics have turned into a self-employment story: of the 14,608 debtors who entered proceedings between April and June 2026, 13,007 — nine out of ten — were individuals, the self-employed among them, and filings were 20.2% up on a year earlier (Colegio de Registradores). Most of those people once believed the same thing: that whatever a court might forgive, debts with Hacienda and Social Security were untouchable. Since 18 February 2026 that belief is out of date — and so is the opposite myth the adverts sell, that everything simply disappears. Here are the rules as the Supreme Court has now fixed them, and the arithmetic they produce on a real file.

What the Supreme Court settled in February

The Second Chance mechanism — the exoneración del pasivo insatisfecho in the insolvency law, rewritten in 2022 by Law 16/2022 — lets a good-faith individual, employee or self-employed, ask the court to cancel the debts they cannot pay. Its most litigated question was always public debt. On 18 February 2026 the Civil Chamber of the Supreme Court answered it in a block of judgments delivered the same day (Nos. 254/2026 and 259/2026 to 264/2026), building on the EU Court of Justice's ruling of 7 November 2024 (joined cases C-289/23 and C-305/23):

• The legal cap — the first €5,000 cancelled in full, then 50% of the rest up to a total of €10,000 — applies per public creditor, not once per debtor. Hacienda has its cap; Social Security has its own.
• Surcharges and late-payment interest fall outside the cap and are cancelled in full. They rank as subordinated credits — and on a debt that has been in enforcement for years, they are often a third of the total.
• The regime reaches every public administration — state, regional or local. For a Canary autónomo that includes IGIC debts with the Agencia Tributaria Canaria and the town hall's bills, each under its own cap.
• A derivation of liability — Hacienda or Social Security pursuing a company's debts against its administrator — no longer blocks the discharge automatically. Only conduct amounting to a very serious infringement does.

One limit to keep in view: public debt is exonerable only in a debtor's first discharge (art. 489.3). The law grants that door once.

The arithmetic, on a real file

Take a Fuerteventura autónomo who closed a difficult stretch owing €9,000 to Hacienda plus €2,400 in surcharges and interest, €6,000 in RETA contributions to Social Security plus €900 in surcharges, €3,000 of IGIC to the Canary tax agency, and €23,000 to private creditors — suppliers and an unsecured loan. Under the February doctrine:

• Hacienda: the first €5,000 goes in full, plus 50% of the remaining €4,000 — €7,000 cancelled, €2,000 survives. The €2,400 of surcharges and interest is cancelled entirely.
• Social Security: €5,000 plus 50% of €1,000 — €5,500 cancelled, €500 survives. The €900 of surcharges goes.
• Canary tax agency: its own cap, so the €3,000 of IGIC sits inside the first €5,000 — cancelled in full.
• Private creditors: no cap — the €23,000 is discharged entirely.

Of €44,300 owed, €2,500 survives: about 94% of the file is cancelled. Before February 2026, several courts would have read the caps once per debtor and kept every surcharge alive; the same file could have carried three times as much surviving debt. That is what changed.

What a discharge never covers

The mechanism is broad, not magic. Outside it stay maintenance payments, debts from criminal liability and civil liability for death or personal injury, fines for very serious infringements, the most recent employee salaries, and secured debt up to the value of the security — a mortgage survives to the value of the property; only a shortfall after the property is dealt with can be discharged. And the public-debt caps above are a ceiling, not a promise: what exceeds them is paid or planned.

The questions the self-employed actually ask

Keeping or closing the business. Filing does not, by itself, end the activity. The route chosen decides: liquidation turns the seizable assets into payment and discharges the rest — and in the second quarter of 2026 more than eight in ten Spanish insolvencies were opened with no assets at all, which shortens that road considerably. A payment plan keeps your assets — in the right conditions, the home included — against three years of payments from real income, five in certain cases, notably when the home is preserved. What is left at the end is discharged.

The former administrator. Many Fuerteventura autónomos carry a derivación de responsabilidad from a company that failed years ago. Since February, that derivation alone no longer disqualifies you — the courts look at the conduct behind it, and only fraud on the scale of a very serious infringement closes the door.

Good faith is a checklist, not a speech. No conviction for the relevant economic offences and no very serious tax or Social Security sanction unpaid in the ten years before filing; no insolvency of yours declared culpable; and a complete, truthful file. The court checks this on its own, even if no creditor objects — and a debt you forgot to list is the classic way to lose the whole discharge.

For a Fuerteventura debtor the file is heard by the commercial courts in Las Palmas de Gran Canaria; expect a process measured in months, not days.

Before you file — five practical steps

1. Order your debt certificates — AEAT, Social Security, Agencia Tributaria Canaria, town hall. With per-creditor caps, the exact figures decide real money.
2. Separate principal from surcharges and interest on each certificate: the second block disappears entirely, so knowing its size tells you what the discharge is worth to you.
3. Check the ten-year red flags honestly — sanctions, convictions, a culpable insolvency, the conduct behind any derivation.
4. Decide the asset question early — no assets points to liquidation and the shorter road; keeping the home points to a plan and a five-year horizon.
5. List everything. The discharge covers what the file names; an omission can cost it all.

If the debt is already in enforcement — account freezes included — the Second Chance route can still be opened, and the sooner the numbers are on the table the more of them the caps and the subordination rule can reach. Our Second Chance team runs the full procedure — certificates, filing, hearing — from Caleta de Fuste and Costa Calma. Book a consultation — we reply within one business day.

Common questions

Can debts with Hacienda and Social Security really be cancelled now?
Partly, and more than before. Each public creditor's debt is cancelled in full up to 5,000 euros and at half strength up to a total of 10,000 euros per creditor, and every surcharge and late-payment interest on those debts is cancelled entirely. The principal above the caps survives. This applies only in your first discharge.

Hacienda derived my company's debts to me as its administrator — am I excluded?
Not automatically, since the February 2026 rulings. A derivation of liability on its own no longer blocks the discharge; the court examines the conduct behind it, and only behaviour equivalent to a very serious infringement excludes you. The derivation's paperwork and dates matter, so bring it to the first meeting.

Do IGIC debts with the Canary tax agency count too?
Yes. The Supreme Court extended the public-debt regime to every administration, whichever collects — state, regional or local. An IGIC debt with the Agencia Tributaria Canaria has its own per-creditor cap, separate from Hacienda's and Social Security's, and its surcharges and interest are cancelled in full like theirs.

Facts verified in August 2026 (Supreme Court judgments 254/2026 and 259/2026 to 264/2026, of 18 February 2026; insolvency law arts. 487, 489 and 497 as amended by Law 16/2022; CJEU judgment of 7 November 2024, joined cases C-289/23 and C-305/23; Directive (EU) 2019/1023; Colegio de Registradores, second-quarter 2026 insolvency statistics). Rules move — check yours before acting.