More about Form 720
What is Form 720?
Form 720 is the Informative Form on Goods and Assets Abroad.
“Informative” means that you do not have to pay in anything when filing in the form, although it will have effects on your Personal Income Tax Return and your Wealth Tax Return, as you will have to include the assets you declare in form 720 on your Personal Income and Wealth Tax Returns.
Who should file Form 720?
Only those who were Spanish Tax Residents in 2022 may have the obligation to file in the 720 Form.
Spanish Tax Residents are those that spend in Spain physically over 183 days during the natural year (from January 1st to December 31st), including work travels or holidays abroad. Also, you might be considered a Spanish Tax Resident if your spouse and dependent children are Spanish Tax Residents, unless you can prove otherwise.
In case you are under the Special Expatriate Tax Regime (also known as the Beckham Law), you will not have the obligation of filing in Form 720. However, your spouse might have this obligation because, as you know, the Special Expatriate Tax Regime only applies to the taxpayer that has been granted with it.
Am I obliged to file Form 720?
There is the obligation to declare the referred assets when the whole value for all the assets included under one of the following paragraphs is over 50.000 Euros:
- Accounts and deposits in banking institutions abroad.
- Securities representing the holding in equity for any kind of entities abroad, insurances or accrued pension plans.
- Real Estate abroad and/or rights on them.
If such is the case, a 720 Form must be filed including only the assets and goods included under the corresponding group.
* Cryptocurrencies do NOT have to be included in this form. In 2024 there will be an independent informative form (Form 721) for Cryptocurrencies and ETFs.
If two groups are over 50.000 Euros, the 720 Form will have to include all the assets and goods included under the two groups.
I already filed the 720 Form in the past. Do I have to file it again?
Not necessarily. You only need to file the 720 Form again in case the value of one of the three groups of assets has increased 20.000 Euros regarding the last time you filed it.
The Informative Form on Goods and Assets Abroad must be filed in during the months from January to March after the end of the tax year to be considered.
Therefore, in case you have been considered as a Spanish Tax Resident for 2022, you will have the obligation to file in Form 720, it must be filed in from January 1st to March 31st, 2023.
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Not filing in form 720 or including wrong information can have serious implications. It is true that the European Union Justice Court disallowed some of the penalties, but submitting this form is still mandatory, and not submitting it, or doing it with mistakes, can lead to penalties.
There is a penalty of 20 Euros for each data or group of data that should have been included in the Informative form or have been wrong, inaccurate, or incomplete included, with a minimum of 300 Euros.
Additionally, is you do not file in 720 Form and Spanish Tax Authorities discover the assets placed abroad, and these assets were acquired in the last 4 years, Spanish tax Authorities will understand that these assets were a non-justified capital gain, that will be included in the corresponding Personal Income Tax Return, unless you can prove their source of origin.
This means that in case you had the obligation of filing in this 720 Form, and you have not filed it, the value of all the assets will be taxed at a progressive tax rate that goes from 19% to 28%. You will have to pay in the corresponding amount, plus interests on late payment (an annual 3,75%).
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