Second chance for individuals in Spain: requirements, procedure and effects 2026
The second chance mechanism (TRLC, Law 16/2022) allows individuals and self-employed to obtain discharge of unsatisfied liabilities. We analyse both paths: payment plan and immediate liquidation with provisional discharge.
What is the second chance mechanism
The second chance mechanism (Arts. 486-502 TRLC, as amended by Law 16/2022 of 5 September) allows individuals ( whether business owners or not ) to obtain discharge of unsatisfied liabilities after insolvency proceedings, or without them if requirements are met.
The 2022 reform transposes EU Directive 2019/1023 on preventive restructuring frameworks and significantly expands the scope of the second chance in Spain.
Two access routes
Route A: Payment plan (Art. 497 TRLC)
The debtor proposes a payment plan over 3 years (extendable to 5) to satisfy: maintenance credits, credits with special privilege and 25% of ordinary credits. If the debtor complies, they obtain definitive discharge of the rest.
Route B: Immediate liquidation (Art. 492 TRLC)
If the debtor lacks sufficient assets for a payment plan, they can apply for provisional discharge after liquidation of the active estate. Discharge becomes definitive after 3 years if the debtor's financial position does not significantly improve.
Non-dischargeable debts (Art. 491 TRLC)
Never discharged:
- Maintenance debts.
- Civil liability arising from crime.
- Fines and administrative penalties.
- Public law debts (AEAT, TGSS), except under Route B and only up to the garnishment exemption threshold during the provisional discharge period.
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