Monday, March 27

Spain has not yet updated the form to declare the possession of bitcoin abroad

Key facts:
  • Economist advises registering the holding of bitcoin on foreign exchanges as of December 31.

  • That way, you have information for a future statement.

A few hours after the end of 2021, the Government of Spain still does not offer more details about the Model 720 for the Declaration of assets abroad, a regulation that affects holders of cryptocurrencies in exchanges in other countries.

The situation was highlighted by the tax economist José Antonio Bravo Mateu, through a publication On twitter. In it, the expert remarks that the State did not publish anything in the Official Gazette of the date and that, thus, the limits and the model for making the declaration are not yet known.

Model 720 is mandatory for all Spanish taxpayers who have more than 50,000 euros deposited abroad, both in financial institutions and in cryptocurrency exchanges. Securities, rights and insurance and income abroad are also covered by the regulations. The deadline for submitting it is from January 1 to March 31 of each year.

Although in Spain the obligation to declare the possession of cryptocurrencies is not new, it is that The Treasury is being stricter with controls in this regard. As CriptoNoticias reported a few days ago, several Spanish taxpayers received requests for information about their possession of crypto assets.

Legend: In Spain, the holding of cryptocurrencies must be declared in the Model 720, but it has not yet been configured for it. Source: Twitter @jabravo

Like the Declaration of assets abroad, the wealth tax does not apply to all people, as explained by this medium in the aforementioned article. Only those who have assets of more than 700,000 euros must pay it, which is the exempt minimum. Anything that exceeds that amount is likely to be taxed.

How to be prepared to declare my bitcoins in Spain?

The period for declaring assets abroad begins in January of the following year. That is to say that from the first day of 2022 the term to declare the possessions of the year 2020 opens.

However, as Bravo Mateu explains, the Government of Spain has not yet configured the Model 720 to include the declaration of this type of digital assets.

Faced with this contingency, the expert recommends taking a snapshot of the assets owned by the last day of 2021, that is, on December 31, in “exchanges and custody houses located abroad.” Thus, if a posteriori “the limit to declare and the form is dictated, you already have the data,” he explains.

If this detail is not taken into account, says Bravo Mateu, many people will be “screwed up and without having the necessary data”. It should be noted that this only applies to funds in accounts abroad, but not to non-custodial wallets, says the economist.