This brief look at the obligation to present the 720 form, the deadline for is next March 31 and is currently under infringement proceedings by the European Commission because of its disproportionate sanctions. Law 7/2012 introduces a provision in the Tax imposed by natural and legal persons resident in Spanish territory to report annually on goods and rights located abroad. The regulatory development of this obligation is contained in the Royal Decree 1558/2012, of November 15, by which the General Rules of the actions of tax management and inspection changes. Finally, on January 31, 2013 it was published in the Official Gazette Ministerial Order (OM) HAP / 72/2013, by which the model 720 form is approved.Who are required to declare? Natural or legal persons resident in Spanish territory, permanent establishments in the territory of non-resident persons or entities and entities that Article 35.4 of the General Tax Law (recumbent inheritance, community property, etc. (refer to V1186-13) ).The obligation to declare includes not only cases in which the legal ownership of the assets or rights are located abroad, not only includes the owners but also those who are beneficial owners. Specifically, those with the condition of representatives, agents or beneficiaries (V1225-15).On what possessions is there an obligation to report on? Regarding the following sets of assets / possessions provided that the total value of each of the blocks individually considered assets, exceeding the figure of 50.000 Euros as of 31 December 2015.

  • Current accounts, savings and deposit accounts, located abroad on condition that the holder holds, represents, or is an authorized recipient or has powers at their dispossal.
  • Values, fees, rentals and deposited insurance, managed or obtained abroad.
  • Real estate and rights over them located abroad on condition that they are in the name of the holder.

If it was presented in 2013 and 2014, must I present it in 2015?Anyone who has submitted the model in previous years, will be obliged to present it in the year 2015 if any of the three different blocks of information mentioned had experienced more than 20.000 euros increase over the last return filed. Also if the person had ceased to be in possession of the property for which the obligation to submit the declaration in previous years. Very substantial penalties for failing to declare or declare past the deadline. Future of the Model 720 form.The penalty for failure to file or make errors or omissions is 5.000 euros per data or data group, with a minimum of 10.000 euros per group of assets. The penalty for later submission is 100 euros per data with a minimum of 1.500 Euros per group.In addition to this sanction, the regulation establishes the consequences of failing to report or declare past the deadline, and that the Treasury can consider that foreign assets are capital gains not justified which can be consider a share of the tax income up 56% of its value, plus an additional penalty of 150% of that quota.It is for this reason that multiple complaints have been filed with the European Commission arguing that the planned sanctions regime is very hard and that is an obstacle and a restriction on the free movement of persons under Article 21 of the Treaty on the Functioning of the European Union and the free movement of capital guaranteed by Article 63.In December 2014 the European Commission reported on the findings of their research pointing out that there are two aspects of the model 720 form that can undermine the right of the European Union: the disproportionate penalty system and the imputation as capital gains unjustified assets undeclared in term without the possibility of invoking a limitation period.However, this does not mean the automatic repeal of the legislation denounced, which remains in force.