This is a website for buyers, owners, and sellers of property in Spain, offering reliable information and resources to help you get things done with confidence. It is run by Mark Stücklin, author of the Spanish Property Doctor Column in The Sunday Times (2005-2008), and the book ‘Need to Know: Buying Property in Spain’ published by Collins.
Mark StücklinThe Modelo 720 is being amended, not abolished. If you live in Spain and own assets abroad you might have to file the 720 tax information form (called the Modelo 720 in Spanish) before the end of March.
If you live in Spain and own assets of 50„000€ or more (per asset class) abroad you need to file the Spanish tax form / Modelo 720 before the end of March if this 2021 was your first year in Spain, or if you have never filed it before, or if your assets abroad have increased by 20,000€ or more.
So, for example, if you moved to Spain in 2021 but retained a house worth more than 50,000€ back home, you have to submit the Modelo 720 before the end of the month. The same applies if you have any asset class like cash or financial securities (but not crypto currencies for now) worth 50,000€ or more.
Introduced back in 2012, and effective in 2013, the Modelo 720 was supposed to clamp down on Spanish fraud but in reality just shackled expats with a risk of massive tax penalties for owning legitimate wealth abroad. It has turned out to be ineffective against fraud, a nightmare of expats, and damaging to Spain.
Almost a decade after it was introduced, many expats in Spain still don’t know about the Modelo 720 and the risks they run with non-compliance. Others might have heard that the European Court of Justice recently declared aspects of the Modelo 720 illegal, and figure they no longer need to file it, but that’s not the case.
The ECJ ruled that the penalties for not complying in full with the Modelo 720 were excessive, but you still need to present it. The Spanish government will introduce lower penalties that satisfy the ECJ, though nobody knows when.
So this is just a reminder to file your Modelo 720 tax information declaration on time before the end of March. If you have fallen foul of the law, or are unsure if you need to declare, seek specialist advice.
Learn more about the Spanish tax information declaration Modelo 720 form.
annabellenyren says:
Am I correct in thinking therefore, that if I filed a modelo 720 last year and my properties abroad have not increased in value by 20,000 I do not have to file it again this year, or indeed any year until that position changes?
Mark Stücklin says:
Yes that is correct.
LVR says:
We arrived on November 6, 2021. Do we have to complete this now or only after we have been in Spain for 183 days or after our first year (eg. 2022 so filing next year)? We have our personal house, not rented, in the US worth more than the minimum. Thanks for the clarification.
LVR says:
And, is this for a property that is owned 100%? What if a mortgage is still due to the bank?
Mark Stücklin says:
LVR it sounds like you weren’t fiscally resident in 2021 so don’t need to declare the modelo 720 this year. You’ll have to declare in 2023 for 2022. To be on the safe side check with a qualified expert but I don’t think you have to worry this year.
LVR says:
That’s what I was thinking too – thanks so much! Yes, have an appointment this week with a pro. Thanks!