If you have assets or cryptocurrencies abroad and live in Spain, you may already know that the tax office keeps a close watch. The Agencia Tributaria requires taxpayers to disclose these holdings through specific forms. Ignoring this responsibility could mean facing heavy fines and future tax complications.
To make matters clear, Spain uses two different reporting forms. Modelo 720 applies to traditional assets abroad, such as bank accounts, securities, and real estate. Modelo 721 focuses exclusively on cryptocurrencies held outside Spain. Both come with strict thresholds and filing requirements.
This guide will explain who needs to file, what information to include, and why meeting these obligations is essential for staying compliant with Spanish crypto tax rules.
Modelo 720 Vs Modelo 721
Both forms serve to declare foreign assets, but each targets a different category. Understanding the differences helps Spanish taxpayers know which declaration applies to their situation.
|
Aspect |
Modelo 720 |
Modelo 721 |
|
Purpose |
Declares foreign assets such as bank accounts, securities, and real estate. |
Declares cryptocurrencies held on foreign exchanges or platforms. |
|
Threshold |
Filing required if assets exceed €50,000 per category. |
Filing required if total crypto abroad exceeds €50,000. |
|
Who Must File |
Spanish tax residents, legal entities, permanent establishments. |
Spanish tax residents with crypto held outside Spain. |
|
Valuation Date |
Based on the value as of 31 December. |
Based on the crypto market value as of 31 December. |
|
When to Refile |
If assets are sold, cancelled, or increased by €20,000 or more. |
If crypto holdings increase by €20,000 or exceed thresholds after first filing. |
|
Documentation |
Bank statements, valuation reports, land registry extracts. |
Exchange reports, custody certificates, transaction history if required. |
|
Penalties |
Fines reduced after EU ruling, but compliance remains mandatory. |
Fines starting from €200 for late or incorrect filing. |
Understanding Modelo 720
Modelo 720 is designed for Spanish tax residents to report foreign assets when their value exceeds the required threshold. It applies to traditional holdings like bank accounts, securities, and real estate, ensuring full transparency with the Agencia Tributaria.
Who Must File Modelo 720?
Filing Modelo 720 is mandatory for certain groups of taxpayers when they hold foreign assets beyond the threshold. The obligation applies not only to owners but also to those with associated rights over the assets.
Spanish Tax Residents
All individuals and legal entities who are considered tax residents in Spain must submit Modelo 720 if their foreign assets in any category exceed €50,000.
Permanent Establishments
Non-resident individuals or companies with permanent establishments in Spain also need to declare qualifying assets held abroad under Modelo 720.
Entities Without Legal Personality
Communities of goods, estates under administration, or other entities without a separate legal personality fall within the scope of this filing requirement.
Beneficiaries and Authorised Persons
Even if you are not the direct owner, you must file if you are a beneficiary, authorised person, or hold disposal rights over qualifying foreign assets.
Categories of Assets to Declare
Modelo 720 requires Spanish taxpayers to report specific types of foreign assets once they cross the reporting threshold. These assets are grouped into three main categories.
Bank Accounts Abroad
This includes current accounts, deposits, and balances held in foreign financial institutions. You must provide information such as the account number, the bank’s details, and the year-end balance.
Securities, Rights, and Insurance
Assets such as shares, bonds, investment funds, pension plans, and life or disability insurance policies managed outside Spain must be declared under this category. Valuations are taken as of 31 December.
Real Estate Abroad
Any property or rights over property located abroad, including usufruct rights, must be reported. Supporting documents such as deeds, registry extracts, or acquisition invoices are required to validate these declarations.
|
Note: After a law on anti-fraud measures was passed in 2021, Spain shifted its Crypto reporting from Modelo 720 to Modelo 721. |
Documentation Required for Modelo 720
To correctly file Modelo 720, taxpayers must provide official documents that verify the ownership and valuation of their foreign assets. The required paperwork depends on the type of asset.
Bank Account
You need to provide bank statements covering the last quarter of the year and balance certificates showing the account value as of 31 December.
Real Estate
For properties located abroad, you must present a land registry extract and purchase deeds or invoices that confirm ownership and acquisition details.
Securities and Insurance Policies
Supporting evidence includes valuation reports and certifications issued by financial institutions for securities, shares, investment funds, and insurance contracts.
Understanding Modelo 721
Modelo 721 is a specialised declaration for Spanish tax residents holding cryptocurrencies abroad. Introduced to adapt tax rules to the digital economy, it ensures that crypto assets are reported with the same level of detail as traditional assets.
Who Must File Modelo 721?
This declaration applies to individuals or entities that hold or control digital assets abroad. The rules cover different ownership and authorisation scenarios to ensure accurate reporting of cryptocurrency holdings outside Spain.
Direct Owners
Any Spanish tax resident who directly owns cryptocurrencies on platforms located abroad must file Modelo 721. If the total value of these holdings exceeds €50,000 on 31 December, they fall under the reporting obligation. This applies even if the assets are spread across multiple exchanges.
Authorised Persons
If you are an authorised person on an account or wallet held abroad, you are also required to declare these assets. Authorisation implies having control or the ability to operate the wallet or account, which places you under the same reporting responsibilities as the primary holder.
Beneficiaries
Being a beneficiary of cryptocurrencies abroad also creates an obligation to file Modelo 721. Even if you are not the direct holder, the law requires disclosure of assets where you have a beneficial interest. This ensures that any indirect rights to crypto abroad are fully transparent to Spanish authorities.
Categories of Assets to Declare in Modelo 721
When completing Modelo 721, taxpayers must disclose different types of digital assets held abroad. These assets vary in form and use, but all require clear reporting to ensure full compliance with Spanish tax rules.
Cryptocurrencies
Traditional cryptocurrencies like Bitcoin, Ethereum, and Litecoin must be reported if they are stored on foreign exchanges or custodial wallets. The declaration requires disclosing the number of units held, their valuation in euros at year-end, and the exchange or platform responsible for custody.
Memecoins
Holdings in memecoins such as Dogecoin, Shiba Inu, or other community-driven tokens are not exempt. Even though their value may fluctuate significantly, taxpayers must declare their total worth on 31 December. Any amount above the €50,000 threshold triggers the reporting requirement under Modelo 721.
NFTs
Non-Fungible Tokens (NFTs) representing digital art, collectibles, or virtual land must also be declared when managed through platforms abroad. The declaration requires specifying the type of NFT, the marketplace or custodial service involved, and its market valuation as of the closing of the fiscal year.
DeFi Activities
Assets linked to DeFi activities such as staking, liquidity provision, or lending carried out on decentralised protocols but accessed via foreign custodial platforms also require reporting. Any value exceeding €50,000 must be included, along with transaction statements or platform reports that justify the declared figures.
Documentation Required for Modelo 721
To support the declaration of digital assets, taxpayers must provide official documentation from recognised platforms. These documents confirm ownership, balances, and valuations, ensuring accuracy in the information submitted to the Agencia Tributaria.
Exchange Reports or Account Statements
Exchanges usually issue account statements or balance reports at the end of the year. These reports show the number of units of each asset, their value in euros, and the platform details. Such documentation is essential as it serves as the primary proof of holdings abroad and their valuation.
Custody Certificates
When available, custody certificates provided by platforms act as additional evidence of ownership. These certificates confirm that the assets are held securely in the name of the taxpayer. They enhance the credibility of the declaration and help prevent disputes by offering a direct confirmation from the exchange or custodian.
Transaction History
A transaction history may be required if additional clarification is needed regarding the reported values. This document records every transfer, purchase, or sale, including dates and amounts. It helps justify fluctuations in asset balances and validates the figures included in the Modelo 721, especially when holdings involve multiple movements during the fiscal year.
Penalties for Non-Compliance with Modelo 720 and 721
Failing to comply with Modelo 720 and 721 requirements can result in serious financial and legal consequences. Although the European Court of Justice has reduced the severity of earlier sanctions, the Spanish Tax Agency still enforces strict penalties to ensure accurate reporting. Understanding these consequences helps taxpayers avoid unnecessary disputes.
Monetary Penalties
The Spanish Tax Agency imposes fixed fines for missing or incomplete submissions of these forms. Even small errors, such as failing to provide complete details of an account or wallet, can result in significant financial charges. These fines act as a deterrent and underline the importance of accurate reporting of all required information.
Increased Tax Liabilities
If assets held abroad are not declared through Modelo 720 or 721, the Tax Agency may treat them as undeclared income. This can lead to increased tax assessments, including surcharges and interest on the unpaid amounts. By ensuring compliance, taxpayers reduce the risk of their foreign holdings being reclassified as illicit or hidden wealth.
Legal Consequences
Non-compliance is not limited to financial penalties. In certain cases, repeated or intentional failure to declare assets can lead to legal action. This may involve lengthy investigations, reputational damage, and even criminal proceedings. Spanish authorities take undeclared foreign assets very seriously, especially when linked to large amounts of wealth.
How KoinX Simplifies Crypto Tax Compliance in Spain?
Keeping up with Spanish crypto tax compliance often feels like a constant struggle, especially when every detail matters and the paperwork becomes tough. This is where KoinX makes the process easier. It is a trusted crypto tax platform that helps Spanish taxpayers track, calculate, and prepare crypto taxes without the stress of manual effort. With its user-friendly tools, you can be confident that your reports reflect accuracy and compliance.
Automated Data Import from Exchanges and Wallets
KoinX connects directly with your preferred exchanges and wallets, importing all transactions into one place. This feature saves time, reduces the need for manual entries, and ensures nothing gets left out. From common exchanges to personal wallets, every detail is consolidated automatically for better accuracy.
Accurate Classification of Assets
One of the biggest challenges in crypto tax reporting is categorising transactions correctly. KoinX uses advanced systems to classify assets such as cryptocurrencies, DeFi activities, NFTs, and memecoins. This ensures every taxable event is placed in the right category, avoiding errors that could result in unnecessary penalties.
Spanish-Compliant Crypto Tax Reports
KoinX generates tax-ready reports tailored for Spanish tax rules. These reports clearly show your gains, losses, and income sources, making it easier to stay compliant when filing taxes. By aligning with local requirements, KoinX minimises mistakes and helps you stay prepared for tax submissions.
Free Portfolio Dashboard
Beyond tax reporting, KoinX offers a free portfolio dashboard. This allows users to track real-time values, monitor profits, and understand their entire crypto portfolio at a glance. It gives complete visibility into your holdings without the hassle of switching between multiple platforms.
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Conclusion
Managing foreign asset declarations like Modelo 720 and Modelo 721 can feel overwhelming for Spanish taxpayers, especially when crypto assets add another layer of complexity. Staying compliant requires careful reporting, accurate valuations, and timely submissions.
KoinX helps simplify this process by offering automated tools that ensure accuracy and compliance for your crypto taxes. With features like portfolio tracking, asset classification, and Spanish-ready reports, it removes the stress from tax season. Start using KoinX today to file your crypto taxes with confidence.
Frequently Asked Questions
Are Both Individuals And Companies Required To File?
Yes, both individuals and legal entities residing in Spain must comply with Modelo 720 and Modelo 721 reporting rules. This also extends to permanent establishments of non-resident entities and certain collective entities like estates or communities of goods. The scope ensures both personal and business holdings abroad remain transparent to Spanish tax authorities.
How Often Do I Need To Resubmit These Models?
Once filed, resubmission is required only if you dispose of a declared asset or if the value of any category of declared assets increases by €20,000 or more compared to the last submission. This ensures updated reporting without requiring taxpayers to resubmit forms annually when no significant changes occur in asset value.
What Happens If I Fail To Submit The Forms?
Failure to submit Modelo 720 or 721 can result in heavy penalties. While penalties linked to Modelo 720 have been softened after European Court rulings, significant fines can still apply for non-compliance. Ensuring timely and accurate submissions protects taxpayers from unnecessary administrative and financial consequences in Spain’s evolving tax compliance framework.
Do Cryptocurrencies Held In Self-Custody Wallets Need To Be Reported?
No, Modelo 721 applies only to cryptocurrencies stored with foreign exchanges or custodial platforms. Assets kept in self-custody wallets, like hardware or software wallets managed directly by the taxpayer, are not reportable. However, any crypto held on platforms abroad that safeguard private keys falls under reporting obligations.
Is There A Specific Deadline For Submission?
Yes, both Modelo 720 and 721 must be submitted within the official filing window set by the Spanish Tax Agency, usually between January and March of the following tax year. Missing this period can lead to penalties, so taxpayers must prepare documents and valuations well in advance of the deadline.
What Documents Should Be Prepared In Advance?
Taxpayers should prepare bank statements, certificates of account balances, valuation reports for securities, and exchange reports for cryptocurrencies. Custody certificates and transaction histories may also be needed. Having these documents ready ensures accuracy in reporting and avoids delays when completing the forms for Spanish tax authorities.
