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Reporting obligation on assets located abroad for Spanish tax residents: tax form 720 approved

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3 Mar. 2013

Spanish Government has approved the tax Form to report foreign assets, as well as the regulation of this new obligation.

We recommend checking or reconsidering your position in Spain, in case you do not consider yourself resident or have not declared yourself resident for tax purposes. The increasing tracing capacity of the Tax Authorities plus the consequences in case of failure in complying with this new reporting obligation, makes it highly advisable.

Three different reporting obligations in only one tax Form.

Who must report? All tax residents in Spain: individuals (including foreign citizens resident in Spain for tax purposes), companies, permanent establishments, heritages, partnerships, etc.

When? The first year to report is 2012. The Form must be submitted from 1st February to 30th April 2013. For further years, the reporting period will be between 1st of January and March, 31st of each year.

What information must be reported? There are three different groups: a) bank accounts, b) securities, insurances, etc., and c) properties, in case that the value of each group exceeds 50.000 €.

How is this information declared? Tax Form 720 must be submitted electronically only.

For further information, please check our last newsletter JC&A UPDATE REPORT 01.13 clicking on the link below:

http://www.jca-abogados.com/newsletter/JCA_UPDATE%20REPORT_01.13.pdf

Check your tax status in Spain.

Some Property owners in Spain may consider themselves non-resident because they keep paying taxes in their country, or just nowhere.

To qualify or to be deemed as resident in Spain for tax purposes does not depend exclusively in the 183 days rule, but where the main home is located and family ties are strong evidences.

The Tax Authorities keep records of all property Owners in Spain through the Spanish Land Registry office, and establishing whether a property has been lived in is possible by checking the supply consumptions (electricity, water, etc.). Access to Bank data is also possible, through the use of credit cards in Spain during the year.

Make 2013 the year to clear your tax residency in Spain, or strength your position as non-resident if this is the case.

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