Tax Form 720 year 2014


27 Feb. 2015

Tax Form 720, the informative report on foreign assets and rights held by Spanish tax residents for tax period 2014 must be filed again before March 31 if any of the blocks (accounts, stocks, real estate) has increased above 20.000 Euro in relation to previous year (i.e., the balance of a bank account increases by 30.000 Euro derived from the sale of shares; one block has increased in more than 20.000 Euro compared to previous year although the global amount [account + shares] has not, etc.).

It must be also filed if any of the three blocks exceeds the amount of 50.000 Euros for the first time since 2012.


The Commission initiated an investigation following a number of complaints on the Spanish declaration of assets located abroad (ref. EU Pilot platform 5652/13/TAXU), with the following main conclusions (16/12/2014) further to their meeting with the Spanish authorities in May 2014 and subsequent study:

They have concluded that the declaration is not a restriction of EU law and it appears proportionate; the deadline for submission is not shorter than other deadlines for domestic tax returns; the obligation of telematic submission is either restrictive or disproportionate; the complexity and potential difficulties when filling the declarations  are covered with a wide range of support actions and services; and the consequences of late filing, wrong filling or filling by other than telematic means are not automatic as, “in their understanding and based on the information received from the Spanish authorities, the application of fines may depend on the availability or not of the information subsequently supplemented to the initial declaration“.

Regarding the fines, although they confirm that they have no evidence that the application of the penalty regime is disproportionate, meaning that the administrative practice implies a systematic heavy penalization of all minor failures to declare, even when there is no impact on the taxpayer`s tax liability, the Commission intents to continue this part of the investigation. We highlight the affirmation of “according to the information available it seems that the fines applied in the event of a late declaration voluntarily made by the taxpayer are significantly lower than those applicable in the event of a failure to declare or wrong declaration“.

Regarding the non-declared assets treated as unjustified capital gains, the Commission has decided also to continue the investigation because a longer limitation period might not be compatible with EU laws when the tax administration already has evidence from other sources about the assets located abroad, particularly in an EU/EEA legal framework.

In both cases they propose the launching of an infringement procedure.


When the Spanish Authorities announced Form 720, they warned about the tough consequences for those not complying with the reporting obligation in due time, and late submission wouldn´t save from heavy penalties creating a real “fiscal cliff”. The information that seems to have been provided by the authorities to the commission is not in line with the legal text and the warnings. Nevertheless, we have to say that in our professional experience in similar cases, a voluntary late declaration makes a huge difference. Thus, we strongly advice on voluntarily regularization.

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