Do you have doubts about whether you should declare assets and rights abroad?

In this post, we are going to solve some doubts that may arise when it comes to knowing if you should declare your assets and rights abroad, using Form 720 Spain.

What types of assets and rights must be declared through Form 720 Spain?

If as a person or entity you have bank accounts in financial entities located abroad, securities, rights, insurance or income deposited, managed or obtained abroad, or real estate located abroad or rights over them, you must declare them in the Form 720 Spain.

Is there an obligation to declare a bank account opened abroad, or the ownership of a property, when the balance or value respectively exceed € 50,000 as of December 31, but the ownership is shared between several people?

There is an obligation to report on a bank account opened abroad or the ownership of a property located abroad (and if there are no exceptions in the obligation to declare) regardless of the number of holders.

Is it mandatory to declare assets such as works of art, boats, gold bars, jewelry, or cash not deposited in bank accounts?

It is not mandatory to declare such assets and rights abroad. It is different that, as a consequence of such assets, situations are generated that must be declared in the Form 720 Spain.

Are the heirs required to declare with the Form 720 Spain?

The heirs are obliged to declare with Form 720 Spain as long as there is a tacit or express acceptance of the inheritance.

Does the lack of declaration on time with Form 720 Spain have consequences if one is obliged to do so? Does your incorrect presentation have consequences?

It is a tax offense not to present the aforementioned information obligation on time or to present incompletely, inaccurately or with false information. Its submission by means other than electronic, computerized and telematic means also constitutes a tax offense.

These infractions are all considered very serious infringements.

Should undeveloped land be declared on Form 720 Spain?

The answer is yes. If I am a natural person residing in Spain and I own land in Sweden on which there is only forest, without there being any construction on it, I must declare it with Form 720 Spain if the acquisition value was greater than € 50,000.

And, is that, our Spanish Civil Code includes within the definition of property “the lands, buildings, roads and constructions of all kinds attached to the ground.”

With virtual currencies located abroad, it is intended to introduce the obligation to declare them in the Form 720 Spain by whoever is the owner, or is a beneficiary or authorized or in any other way holds power of disposal

When should I submit Form 720 Spain with my assets and rights abroad?

Form 720 Spain must be submitted between January 1 and March 31 of the year following that to which the information to be supplied refers.

Should I declare cryptocurrencies in Form 720 Spain?

In previous statements it was not necessary, because it was considered that the cryptocurrencies were housed in a virtual wallet with no known physical location.

But the Draft Law on prevention and fight against tax fraud, transposing Dir (EU) 2016/1164, which establishes rules against tax avoidance practices that directly affect the operation of the internal market, and Dir (EU) 2017/1852 on the mechanisms for the resolution of tax disputes in the European Union, and the modification of various tax regulations, will provoke that cryptocurrencies be declared in Form 720 Spain.

Regarding information on cryptocurrencies, the aforementioned draft introduces the following novelties:

– It is intended to reinforce tax control over taxable events related to virtual currencies (also called cryptocurrencies).

– A new obligation to supply information (of declaration) is established to persons and entities resident in Spain and to permanent establishments in Spanish territory that provide these services in relation to the operations and balances maintained by holders of virtual currencies.

– In relation to virtual currencies located abroad, it is intended to introduce the obligation to declare them in the Form 720 Spain by whoever is the owner, or is a beneficiary or authorized or in any other way holds power of disposal, as well as the corresponding sanctioning regime for breach of this obligation to report on cryptocurrencies (bitcoins and others) in Form 720 Spain.

If you have doubts as to whether you should declare Form 720 Spain, or if you know that you should submit it, do not hesitate to contact the Pérez Parras Economists y Lawyers Firm. We are experts in international taxation, as well as taxation of residents and non-residents, and we will help you streamline filing procedures, avoiding errors and penalties.