From this year 2013, there is a new obligation of providing information to the tax office concerning the assets located abroad owned by Spanish residents (either individuals or companies).
The information to be provided this year includes the three following blocks of assets held at any time during 2012:
- Bank accounts or deposits.
- Stocks, bonds, values, financial rights, and insurances.
- Real estate.
Each of the three blocks of assets constitutes an obligation of information, even though the three reporting obligations are articulated over the same form, the Model 720.
This obligation is not only for the owners of those assets, it is extended to authorized users and beneficiaries of bank accounts, and also to beneficial owners and title holders of rights in rem on real estate.
On the other hand, the law exempts from this obligation assets worth less than 50,000 euros per asset block.
For example, you are not obliged to declare if you only have a bank account with 25.000 euros. But you do if also are an authorized signatory on a relative’s account worth 30.000 euros.
Once declared, the submission of the statement will not be compulsory until there is an increase in the value of the assets included in any of the blocks worth more than 20.000 euros.
Despite being an informative declaration, taxpayers that fail to declare their assets through Model 720 will be subjected to a fine of not less than 10.000 euros for each asset type. Filling incomplete or with non-accurate data, will as well be punished with the same minimum fine.
Moreover, failure to comply with these obligations will have repercussions on personal or corporate income tax, if the tax authority discovers hidden assets. In this case, the assets will be included in the last open tax year, and will involve a fine up to 150% of the value of all the undeclared assets.
To this end, the Government is currently in the process of agreements that will allow the sharing of financial information between countries.
This obligation must be fulfilled within January and March of each year, although this first year 2013, the reporting period will last until April 30th.
For further information of your obligations under this new declaration, do not hesitate to contact us.