Tax form 720 | Malaga Solicitors

Tax Form 720 for residents in Spain

At Malaga Solicitors, we specialise in preparing and optimising the tax form 720 (Modelo 720) for our resident clients who own assets and rights located abroad.

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What Is Modelo 720 and why it matters for expats?

Tax Form 720 is an informative tax declaration required by the Spanish tax authorities (Agencia Tributaria) for residents in Spain who hold assets or rights located abroad. It’s not a tax payment form, but rather a mandatory disclosure. However, failure to comply can still result in serious penalties.

For expats living in Spain, this form is especially important because it applies once you become a Spanish tax resident—even if your foreign assets were acquired before moving to Spain. If you hold a bank account in your home country, own property abroad, or have investments outside Spain, you may be obligated to report them.

Introduced in 2012 as part of Spain’s efforts to combat tax fraud, Modelo 720 remains a key compliance requirement, particularly for newcomers who may not realize that their global assets fall under Spanish scrutiny.

If you’re new to Spain or recently acquired tax residency, Modelo 720 should be on your radar early, especially before the March 31st deadline.

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Who are Obligated to file Form 720?

This return must be filed by individuals and legal entities resident in Spain who, as of December 31, are holders, beneficiaries, authorized or have power of disposal over:

Accounts in financial entities located abroad.
Securities, rights, insurance and income deposited, managed or obtained abroad.
Real estate and rights over real estate located abroad.

The obligation arises if the combined value of the assets in each category exceeds 50,000 euros.

What are the penalties for not filing or incorrectly filing the Model 720?

Non-compliance with the obligation to declare can lead to significant penalties. Actually, the penalties for not filing the Form 720 or filing it incorrectly can range between 10,000 and 20,000 euros, depending on the seriousness and circumstances of the non-compliance.

How and when do I file Form 720?

The return must be filed telematically through the Electronic Headquarters of the Tax Agency. The deadline for filing is March 31 of the year following the tax year to which the information refers. For example, for the fiscal year 2025, the deadline is March 31, 2026.

Are there any exemptions to the reporting obligation?

Yes, there are situations in which it is not mandatory to file Form 720, such as:

When the assets or rights are duly recorded in the accounting of a company or entity.
If the assets were declared in previous years and have not experienced an increase of more than 20,000 euros.

It is advisable to review each particular case or consult with a tax advisor to determine the obligation to declare.