STORIES

30 January, 2015

Filing of Form 720 (Reporting of Overseas Assets) is due again

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The obligation to report the Spanish tax authorities on overseas assets is already known by most Spanish resident taxpayers, especially affecting individuals.

Every year we must review which are the limits to declare as the non- accomplishment of this obligation is subject to severe tax penalties.

✔The first fiscal year in which this obligation about overseas assets was introduced was in 2012. By then, Spanish taxpayers were obliged to report on overseas assets / rights located out of Spain for each of the following groups that, on a stand alone basis, had a value exceeding 50,000.00 Euro:

 

  • All type of deposits in financial institutions (authorized signatories were also included).
  • Securities, rights, insurance and annuities either deposited, managed or obtained out of Spain.
  • Real estate and title holders of real estate rights.

 

✔Once a tax return has been filed for a given fiscal year, taxpayers must annually review whether:

 

  • The total value per category of the assets / rights exceeds in more than 20,000.00 Euro the value previously declared.
  • The assets /rights previously declared are no longer held by the taxpayer, regardless of their amount.

 

In the event that any of these circumstances occurs, it is mandatory to file again this tax return, except that any of the regulated exemptions applies to our case.

✔ A note to take into account relating to the application of this obligation: the European Commission is currently investigating whether it is compatible with European rules, given that it relates to overseas assets (not those located In Spain) and it is subject to severe tax penalties applying for non-compliance.

Does this mean we are at the beginning of the end?

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