What is Modelo 720
Modelo 720 is an informative declaration that must be submited to the Agencia Tributaria by any physical or legal person who own assets outside Spain.
This way Hacienda can collect information about the contributor’s assets and rights abroad.
WHO MUST SUBMIT IT?
All physical or legal persons resident in Spain who own assets outside of the country with a total value of more than 50,00 euros.
WHEN MUST IT BE SUBMITED?
From January 1st to March 31st 2022.
HOW OFTEN SHOULD BE SUBMITED?
Modelo 720 must be submited only once. Exceptionally it should be declared again when the overall value of any of the three separate groups has increased by more than 20,000 or when any of the assets has been sold.
WHAT TYPE OF ASSETS MUST BE DECLARED?
There are three type of assets whose details must be declared in Modelo 720.
- Bank accounts in finantial entities abroad.
- Balances, incomes, insurance and taxes deposited, managed or obtained abroad.
- Real estate outside of Spain.
Note, if you are liable to file Modelo 720 and you do not do it or miss the deadline, heavy penalties may apply.
Modelo 720 about assets abroad is an informative declaration with a severe sanctioning regime if neglected. In the recently published statement of the Court of Justice of the European Union (CJEU) from January 27th, the court has found that many of the effects derived from not submitting Modelo 720 or submitting it out of time are against free movement of capital. Besides, it has been concluded that the effects of not submitting Modelo 720 or submitting it out of time are excessively severe.
Once a taxpayer has submitted Modelo 720 about one or many obligations, they must only submit it again when one of these obligations increases its value by more than 20.000 euros with respect to the Modelo submitted for the last time.
The increment that must be taken into account is the increment experimented by the joint balance that determined the Modelo had to be presented in the previous submission.