Once the first declaration of Form 720 corresponding to a fiscal year has been filed, must it be filed again each year?With regard to what information should it be filed again?

Once Form 720 has been filed with regard to one or more of the disclosure obligations in it (referred to in question no. 1), this Form should only be filed again when, in relation to one or more of these obligations, there is an increase of the overall limit established for each information block above 20,000 euros compared with what the last declaration determined.

Example:

Form 720 is filed during fiscal year 2013, with respect to the information of fiscal year 2012.In this Informative Tax Return, bank accounts in financial institutions located abroad and properties abroad with the following balances and values were disclosed:

 

Balance of the last quarter 2012

Balance at 31/12/2012

Account nº 1

40,000

45,000

Account nº 2

15,000

12.000

TOTAL OF THE BALANCES

55,000

57,000

 

Cost price

 

Property nº 1

50,000

 

Property nº 2

20,000

 

TOTAL value

70,000

 

The obligation to file the Informative Tax Return, Form 720, shall return in successive periods whenever an increase occurs in the overall limit established for each information block above 20,000 euros compared with what the last declaration determined.

Fiscal year 2013

If in fiscal year 2013 the values of the properties are not substantially changed (and there is also no other cause for it to be filed, such as would be its sale), the overall balance of all accounts in the last quarter increases by €15,000 and the overall balance of all accounts as at 31 December increases by €18,000, such that the total balances are as follows:

 

2013 fiscal year

 

Balance of last quarter 2013

Balance at 31/12/2013

Account nº 1

20,000

18,000

Account nº 2

40,000

23,000

Account nº 3

10,000

34,000

TOTAL OF THE BALANCES

70,000

75,000

The increases experienced in the overall balances of the accounts have been as follows:

 

Increase of the overall balance in the last quarter

Increase of the overall balance as at 31 December

Increase versus fiscal year 2012

15,000

18,000

In fiscal year 2013 there will no obligation to file Form 720, with regard to the obligation to disclose properties abroad (Article 54 bis of the General Regulation approved by Royal Decree 1065/2007, of 27 July).Neither is there an obligation to file Form 720, with regard to the obligation to disclose information on accounts in financial institutions located abroad (Article 42 bis of the General Regulation approved by Royal Decree 1065/2007, of 27 July) since the (total) overall balance in the last quarter and the (total) overall balance as at 31 December have not increased by more than €20,000 compared with the amounts identified by the obligation to declare in the last fiscal year it was filed, in this case in the prior year (provided that no other cause requiring it to be filed also arises, as would be the case for example the transfer or where applicable cancellation of any of them).

Fiscal year 2014

If in fiscal year 2014 the overall balance of all accounts in the last quarter increases by €2,000 and the overall balance of all accounts as at 31 December increases by €10,000. The increases of balances for each year and in total are as follows:

 

Increase of the overall balance in the last quarter

Increase of the overall balance as at 31 December

Increase versus fiscal year 2012

15,000

18,000

Increase versus fiscal year 2013

2,000

10,000

Increase versus the last fiscal year in which a declaration was filed due to this information disclosure obligation (Article 42 bis of the General Regulation approved by Royal Decree 1065/2007)

17,000

28,000

The increase that must be taken into consideration is the increase experienced in the overall balance of the last quarter and of the overall balance as at 31 December compared with the balances identified by the obligation to declare accounts in financial institutions located abroad (Article 42 bis of the General Regulation approved by Royal Decree 1065/2007, of 27 July) in the last fiscal year in which it was filed.

In this case, the increase of the overall balance as at 31 December 2014 compared with the overall balance as at 31 December of the last fiscal year in which a declaration, Form 720, was filed due to this information disclosure obligation, has been above €20,000, so in fical year 2014 an Informative Tax Return, Form 720, shall be filed due to the obligation to disclose information on all accounts in financial institutions located abroad.

Regulations:   The regulation of “frequency” in the presentation of the Informative Tax Return with respect to each of the obligations is found:

  • in Section 5 of Article 42.bis of the General Regulations passed by Royal Decree 1065/2007 of 27 July for accounts in financial institutions located abroad;
  • in Section 5 of Article 42.3 of the General Regulations approved by Royal Decree 1065/2007 of 27 July for securities, rights, insurance and incomes deposited, managed or obtained abroad;
  • in Section 7 of Article 54.bis of the General Regulations passed by Royal Decree 1065/2007 of 27 July for property and rights on property located abroad.
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