In Spain, there is an obligation to declare all assets, estates and rights held abroad whose value exceeds €50,000. This is an informative declaration. No tax has to be paid.
Royal Decree 1558/2012 indicates that the period for compliance with these obligations is from 1 January to 31 March of the year following the year to which the information relates.
The taxpayer must provide the tax authorities with the following information:
(a) Information on bank or similar accounts opened abroad in the taxpayer’s name or over which the taxpayer has power of disposal.
Note that the reporting obligation applies per asset category and NOT per asset. If you have 3 bank accounts of EUR 20,000 each, you must file a declaration if the total in one asset class (in this example, the asset class of the bank accounts) exceeds EUR 50,000.
(b) Information on all shares, securities or capital rights managed or acquired abroad.
This refers to declaration of equity or assets of any type of entity, such as private companies, foundations or associations, or equity managed to third parties over which they have control or of which they are directors.
This type of disclosure obligation also includes life or disability insurance or pension plans.
(c) Information on real estate and property rights abroad.
This includes other assets such as boats, jewellery, (art) collections, cars, etc.
The reporting obligation also applies to persons considered beneficial owners!
Severe financial penalties will be imposed if you fail to comply with the following conditions:
– Filing the declaration within the prescribed time limit;
– Providing complete, accurate and detailed information;
– Filing the declaration in the proper form (internet, form).
Missing assets will be considered as undeclared profits and their value will be taxed at around 52-56%. Moreover, high penalties can be imposed for any data or composition of data that should have been included in the declaration or whose declaration was incomplete, incorrect or false.
This return must be filed by 31 March each year using Form 720.
Excluded from this requirement are all assets whose values in total for each group (up to and including c) are less than EUR 50,000. Later declarations in later years may show other amounts, in which case vigilance is required.
Also those who have already filed this declaration and, compared to the previous declaration, there is no category with an increase greater than EUR 20,000 are excluded .
Information to be provided
(a) For accounts with financial institutions:
Listing of account numbers, balances of these accounts on 31 December and the average of the last quarter of the year and the date of opening or closing. In addition, the full name of the financial institution, its VAT or CIF number and the address of the financial institution should be given. All savings accounts, time deposits, pension accounts or other accounts, regardless of the amount or name of the account, should also be noted.
(b) For stocks, shares, bonds, other forms of investment, financial claims, (savings) insurance and annuities held or managed abroad:
The type of investment, date of purchase, name of the company/bank and associated address and registration number, balance sheet as at 31 December each year, as well as the reference number and number of shares in the relevant fund.
For example, if you have a policy in dollars, convert it into euros at the exchange rate in force on 31/12/2022.
(c) In case of property assets, such as real estate, boats, cars, etc.:
The brand/type, address, purchase date and purchase price.
Please be aware that according to the rules between European Member States, tax authorities can and will exchange information among themselves!
If you would like us to take care of this tax return for you please send us all necessary information by 25 March at the latest. All necessary information should be entered in our spreadsheets. For all assets entered in the spreadsheet, please enclose the 2022 annual declaration as a PDF. In case of real estate, a document showing the value on 31/12/2022 must be included.
Note! This declaration requirement is in addition to your “Declaración de la Renta” and your asset declarations. Also, if you declare interest from a foreign bank account in your “Declaración de la Renta”, for example, you must also declare it here because of this obligation.
Lucia Guillen Molina