Spanish residents have until the end of this month to declare holdings
The Finance Ministry approved the latest obligation on individuals and companies in fall of last year, as part of its drive against tax fraud. The period in which such assets can be declared began at the start of February and ends on April 30.
The Tax Agency hasn’t exactly made things easy: the form on which the assets have to be detailed is not without its complications and can only be sent via the internet. Below are some of the most common doubts raised with respect to this new obligation on taxpayers.
Who has to declare? Individuals or companies that pay personal income or corporate tax with assets and rights overseas valued at over 50,000 euros. The rule applies both to Spaniards and foreigners resident in Spain. The rule does not apply to retirees from other countries who spend periods of the year in Spain.
What assets have to be declared? The Tax Agency identifies three classes of assets: accounts in overseas banks, securities and shares, or other forms of participation in foreign companies, as well as real estate and any rights to the use of real estate.
Beyond what limit must a declaration be made? This is one of the areas that has raised most doubts. No declaration is necessary for each of the three classes if the sum involved for each is under 50,000 euros. For example, a taxpayer with 30,000 euros deposited in a bank account in Germany, a garage in Andorra valued at 45,000 euros and shares in a Swiss company worth 40,000 euros is not obliged to make a declaration. Taxpayers are obliged to declare assets in one of the three classes if the value of those assets is over 50,000 euros, but not in the other two classes if the value is below 50,000 euros.
How do you present the declaration? Through form 720. It can only be sent via the internet, which means that the declarer must have an electronic signature. A number of tax specialists have complained about the complexity of the process.
How are the assets to be valued? In the case of bank accounts, the value is that as of December 21, 2012 and the average balance in the account in the last quarter of the year. As regards assets such as shares, the value is that of the market price at the end of the year. In the case of property, the value is that of the acquisition price at the official exchange rate at the end of the year.
What happens if you don’t declare? Fines amount to 5,000 euros for every detail on the assets omitted. Sanctions may be up to 150 percent of the value of the asset in question.
via http://elpais.com/elpais/2013/04/22/inenglish/1366654455_160057.html
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