Last year was the first year that residents in Spain had to complete a Modelo 720 asset declaration form. This form, issued by the Spanish Tax Authority, is for information purposes only according to a requirement that exists within the European Union.
Last year it had to be completed before the 30th April. This was a month later than originally planned and this year, the deadline is March 31st.
Every resident who has assets outside of Spain that total over 50,000€ within any one group, must complete the asset declaration form in Spain before the deadline or risk incurring a substantial fine.
The groups are:
- bank accounts (group 1)
- pension plans and investments (group 2)
- property (group 3)
I have assets, must I declare them?
What has confused some people is that the types of assets they must declare against can be divided into three groups:
Group 1: accounts held abroad where the total balance of all the accounts exceeds €50,000. This total is not divisible between account holders. This includes bank, savings and deposit accounts where you are the account holder or have had authorisation over the funds during 2013.
Group 2: other assets and pensions held abroad exceeding €50,000 in value. This includes bonds, stocks and shares, life insurance, pension plans and annuities that are currently being paid. You are in this category if they have either a total value or a surrender value on the 31st December 2013 of €50,000 or more. We can confirm that private and company pensions currently being drawn are included in this category if their capitalisation value exceeds the 50,000€ limit.
Group 3: property or business premises abroad. This applies to you if you live in Spain but still own a business or house in another country whose purchase value was more than €50,000.
Who needs to complete it this year?
If you completed the 720 last year and your circumstances have not changed then there is no need to complete one this year.
You should complete one this year if:
- You are a new resident in Spain and this is your first tax year
- You did not declare for 2012 and should have
- There has been an alteration in your circumstances such as:
- You have purchased or sold property
- Investments have matured
- You have changed account numbers
- You have cancelled, closed or sold previously declared assets
- Your assets have increased by 20,000€ or more of total assets in any of the groups previously declared
- You declared last year, but this year have reached more than 50,000€ in a previously undeclared category
What will happen if I don’t?
The fines published by the Spanish Tax Authority are substantial. They include:
- Non-presentation/ false information – fine of 5,000€ for every piece of information with a minimum fine of 10,000€
- Late presentation/ form wrongly presented e.g. not presented electronically – fine of 100€ for each piece of information with a minimum fine of 1,500€
Late presentation only refers to those asset declarations that are voluntarily presented and not those prompted by demands from the Spanish Tax Authority.
What should I do next?
The form is not easy to complete and requires a ‘signature’ to do so. Most people need to engage with a fiscal representative to help them complete it. The next deadline is the 31st March.
The 720 is for information purposes only but the penalties are just too great to ignore.
We invite you to a FREE consultation with a tax specialist in your language:
- Opportunity to ask questions about resident tax – what should/ shouldn’t you be paying?
- Clarify what’s happening with the 720
- Bring your tax declaration – not everyone explains it quite like we do!
- No obligation and completely confidential
Contact us on (+34) 96 670 3748 or Request a Call Back.