Tax Form 720 Asset declaration

Information and questions about the Law in Spain and Andalucia.
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Mowser
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Re: Tax Form 720 Asset declaration

Postby Mowser » Thu Jan 31, 2013 8:27 pm

If anyone is worried about assets out of Spain, what's wrong with bringing the excess into Spain?
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Re: Tax Form 720 Asset declaration

Postby Miro » Thu Jan 31, 2013 8:32 pm

The declaration isn't due until April 30th, but the value to be declared is that on Dec 31st 2012 isn't it?
So even if you upped and left now, you can't escape. Even if I declare myself non-resident tomorrow, they're looking at my overseas assets during 2012 when I was resident.
I've never had a problem with the tax laws here, but I feel very uneasy about this latest development, on top of which Hacienda have refused to issue me a fiscal residency certificate; I've never had a problem getting one before, and they haven't even given me any reason. I don't understand what's going on - that makes me nervous. If I could leave last year, I would. :(
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Re: Tax Form 720 Asset declaration

Postby Mowser » Thu Jan 31, 2013 8:42 pm

The declaration isn't due until April 30th
I thought the press release from Hacienda said that all assets had to be declared at the end of the first quarter of 2013. That would make it March 31st. That leaves me two more months to get everything in order.

(On a separate note, I hold some premium bonds. The maximum amount you can have is £30,000. I assume - and hope - that I don't have to add this to my bank details).
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Re: Tax Form 720 Asset declaration

Postby Mowser » Thu Jan 31, 2013 8:47 pm

I think I'm OK regarding the bonds as the decree says, "The Royal Decree exempts from this obligation the need to declare assets worth less than €50,000 per asset type."

In short, I take it that all my bank details (savings) get added together and this counts as one asset type.
My bonds are another asset type.
My flat in the UK is another asset type.
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Re: Tax Form 720 Asset declaration

Postby Miro » Thu Jan 31, 2013 9:49 pm

El Cid wrote:Not declaring your assets will probably save you paying wealth tax as if they find out that you haven't declared you won't be left with any wealth to tax. :thumbdown:
Just for the record, I have no intention of trying to avoid this declaration - I'm just terrified of making an innocent mistake (e.g. are Premium Bonds counted as "bonds" or equivalent of bank deposits? I have no idea, I'm no financial expert)

If (big if) I manage to sell my home this year, and return to the UK with the proceeds, presumably I will have to complete another declaration in Q1 2014 because my overseas assets during 2013, when I was still a resident, will have increased by more than 20K?

I will also of course have to pay capital gains tax, (even though I'll be reinvesting the funds in another property within the EU) and the buyer will most probably also have to pay transfer tax on an amount greater than they actually pay because Hacienda refuse to accept that market value is nowadays sometimes less than 2.5 times the valor catastral.
Sorry, digressing... :oops:
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Re: Tax Form 720 Asset declaration

Postby CapnBilly » Thu Jan 31, 2013 10:49 pm

I would say that premium bonds are part of the first category, and need to be added to your bank and savings accounts. There are various summaries circulating the net, which include "bonds" in category 2, but I think these relate more to corporate or government bonds, than "savings" or "premium" bonds. IMHO, "bonds" to be included in this category (2), are generally traded on the markets. I might be wrong of course, but there is a lot of confusion about these things.

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Re: Tax Form 720 Asset declaration

Postby Miro » Fri Feb 01, 2013 9:28 am

I have read elsewhere that for any bank accounts being declared, they also require the IBAN and BIC. Call me alarmist, but if that's not in preparation for plundering said accounts at any given opportunity, I don't know why they would need such info. :shock: I find this very sinister.
Also, I understand they want to know about any assets sold, or accounts closed, during 2012. So, if you moved a lump sum from one bank to another half way through the year, you'll effectively have to declare that amount twice, in the overall balance figures. I can see the clueless clerks at Hacienda determining that you have more than you actually do - and then what? An arbitrary fine because some jobsworth doesn't understand the info he's looking at?
On premium bonds - someone with their maximum 30K could have dozens or hundreds of individual bond numbers. Or does one just declare their holder's number and the total? Will anyone in Hacienda have a clue what these are anyway? Will Hacienda just implode under the weight of meaningless information they will be inundated with?

P.S. Sid - the link you gave earlier for the draft form doesn't seem to work for me
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Re: Tax Form 720 Asset declaration

Postby Mowser » Fri Feb 01, 2013 9:40 am

On premium bonds - someone with their maximum 30K could have dozens or hundreds of individual bond numbers.
If they do, it's illegal. You are only allowed to have a maximum of £30,000 per person.
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Re: Tax Form 720 Asset declaration

Postby gus-lopez » Fri Feb 01, 2013 9:46 am

[quote="Mowser"

(On a separate note, I hold some premium bonds. The maximum amount you can have is £30,000. I assume - and hope - that I don't have to add this to my bank details).[/quote]

Just remember that you have always had to pay tax on any winnings! :lol:
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Re: Tax Form 720 Asset declaration

Postby El Cid » Fri Feb 01, 2013 9:48 am

Miro, no, the page that the link went to has been removed.

They approved the new Form 720 process a day ago and have published the final guidance here

http://www.boe.es/diario_boe/txt.php?id=BOE-A-2013-954

There is no form 720 as such. You will have to download a program from their site, just like you have to do for your income tax declaration, and you compile the data on your PC. The program checks the validity of the submission and if it's OK then you transmit the data to their computers.

You will need a digital certificate to do this. If you don't have one then the only way of submitting the information will be through an authorised third party such as the people who do your normal declarations.

For income tax declarations you can make an appointment at you local tax office and they will input all your data for you . I don't know if they will make a similar service available for this excercise.

As for your comments about IBAN and BIC - how else would you expect to identify a bank account as that is the internationally recognised way of doing so.

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Re: Tax Form 720 Asset declaration

Postby Julie » Fri Feb 01, 2013 10:51 am

Purely out of interest, because we aren't residents, If one didn't tell the Spanish tax man anything, re: property and money one has in the UK, would they ever find out? In the UK unless somebody reported you, the tax man is unlikely to know about it.

Also, It appears to me from what little I have read on here over the years, that a person say with a couple of hundred k in the bank and a couple of houses, would be much worse off being resident in Spain, is this right ?
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Re: Tax Form 720 Asset declaration

Postby El Cid » Fri Feb 01, 2013 10:59 am

You're right, it's very unlikely that they would find out unless they specifically wanted to, in which case they could easily get that information from the UK authorities.

What is different about this present scenario is that penalties for getting caught are massive and that in itself will deter people from ignoring it.

Generally taxes are higher in Spain than in the UK but that doesn't usually deter people from coming here.

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Re: Tax Form 720 Asset declaration

Postby Miro » Fri Feb 01, 2013 11:23 am

Mowser wrote:
On premium bonds - someone with their maximum 30K could have dozens or hundreds of individual bond numbers.
If they do, it's illegal. You are only allowed to have a maximum of £30,000 per person.
My premium bonds are in £1 units - each with it's own number. 30,000 of them.
Don't worry about what people think, they don't do it very often

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Re: Tax Form 720 Asset declaration

Postby Mowser » Fri Feb 01, 2013 11:32 am

Miro. I thought you were implying that someone could have hundreds of thousands of bonds!
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Re: Tax Form 720 Asset declaration

Postby katy » Fri Feb 01, 2013 11:37 am

I agree Cid, I wouldn't recommend anyone to not declare. However. logically I think they are after big fish and can't possibly police it. Risk takers will only give a limited declaration. We used to pay the old wealth tax in Spain until a few years ago when it was abolished but didn't declare offshore assets.

Probably the best thing to do for people with properties in the UK is to set up a company for very little cost. Avoid financial advisers on the coast offering solutions. Some friends had a Jersey trust set up to avoid tax and now are having to pay thousands each year in administration costs.

Generally taxes are higher in Spain than in the UK but that doesn't usually deter people from coming here.

Well we have seen it on here, many have been here years before they start asking about residents taxes and inheritance laws :lolno:

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Re: Tax Form 720 Asset declaration

Postby Miro » Fri Feb 01, 2013 9:03 pm

El Cid wrote: As for your comments about IBAN and BIC - how else would you expect to identify a bank account as that is the internationally recognised way of doing so.
Fair point, except that BIC is basically the Swift code for international transfers isn't it? :shock: IBAN identifies the account - BIC is only needed if you're going to make a transfer.
I know I'm probably getting worked up about this whole thing for nothing, but I resent the way it's making me feel under suspicion. I've done nothing wrong.
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Re: Tax Form 720 Asset declaration

Postby El Cid » Fri Feb 01, 2013 9:21 pm

Miro wrote: I've done nothing wrong.
In which case you have nothing to worry about.

Tranquillo!

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Re: Tax Form 720 Asset declaration

Postby alpujarran » Sat Feb 02, 2013 9:43 am

Anyone with a NIE has effectively - though probably unwittingly - signed up to the Spanish tax system. Your NIE is your tax id. The Spanish Tax authorities can get details of your bank accounts in any EU country and probably some others. The can embargo any of theses accounts if they want to without any help from you. Same goes for property. When you applied for you NIE you gave them all the details they need to track you across borders.

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Re: Tax Form 720 Asset declaration

Postby Miro » Sat Feb 02, 2013 11:33 am

In which case, why bother with this asset reporting lark at all? Surely they're just creating a mountain of work for themselves that will have very little use or result. If they have any reason to suspect any individual of wrongdoing, why not use their resources to chase that specific lead instead?
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Re: Tax Form 720 Asset declaration

Postby katy » Sat Feb 02, 2013 11:42 am

Lot of scaremongering and paranoia on here :D Banks can and do exchange information and freeze bank accounts. However, there has to be a good reason for it like crime or money laundering etc. Where would all the man(or women :wink: )power come from to personally inspect every citizens affairs :?


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