TAX AND LEGAL MATTERS
Carlos Espinosa
Solicitor and Tax Adviser
(+34) 627 41 32 01
carlos.espinosa@
iurisnautic.com
Obligation for Tax Residents
to Declare Goods and
Properties Abroad
For the year 2014 a new tax
model 720 was introduced
held outside Spain- All real estate or properties
or any right on them located
outside Spain.
As we know tax residents are
individuals that spend more
than 183 days in Spain, or
have here their main center
of economic activity or, also,
there is a presumption of tax
residence when the spouse
lives in Spain and children go
here to school.This Model 720 is just an
informative declaration of
all the worldwide goods and
rights. And not fulfilling this
obligation has minimum
sanctions of 5.000 for any
omitted issue, with a lowest
penalty of 10.000 to 30.000 €
depending if the information
lacked is of one, two or the
whole three aspects referred.
Besides that, if you are
obliged to inform about some
of these goods and forgot it,
the tax authorities in a tax
inspection procedure might
challenge and declare a nonjustified capital gain if you
are not in a position to proof
the origin of the funds; and
what is more important , this
possibility does not prescribe.However, the EU Commission
has seen this sanctions as
disproportionate and are in a
process to claim against Spain
because of them. It seems as
the Spanish Tax Authorities
will stop now all the sanction
proceedings in process.
So in case you have been
sanctioned by un-fulfillment
of the information duty of
Model 720 you might get part
of the penalties refunded
once the procedure at EU-
Court is finished. However the
obligation to inform is
still there.In case of doubt ask your local
tax and legal adviser.according to which all resident
for tax purposes in Spain,
Companies and individuals,
are obliged to inform and
disclose information on:- All bank accounts opened
into their name outside Spain - All stocks, securities,
insurance policies, rentals
and any moveable capital