Modelo 720/721 of the AEAT are required to report of all assets abroad and must be filed by all Spanish residents owning assets abroad, only if they are over the limits described below.

What is Modelo 720 and 721?

Modelo720 was approved on October 29, 2012, as part of the financial regulations to intensify actions in the prevention and fight against fraud.

Modelo 721 started to be reported in 2024 as the Informative declaration on virtual currencies located abroad and it works as an independent fourth block of the 720.

They are informative returns on assets and rights located abroad and have the following objectives:

• To report on accounts in financial institutions located abroad.

• To report on securities, rights, insurance policies, and income deposited, managed, or obtained abroad.

• To report on real estate and rights to real estate located abroad.

• To report cryptocurrencies located abroad (Modelo 721)

The Law divides the assets to be reported into three different blocks (Modelo 720):

1. Accounts in financial institutions abroad, which includes current accounts, savings accounts, term deposits, credit accounts…

Information on each account should include the balance of these accounts on December 31st, the average balance for the last quarter of the year and the date of opening. Also, if you are account holder, authorized…

Holders and authorized holders, who have ceased to be during the year, must indicate only the balance of the day ceased to be holders or authorized holders.

2. Stocks, bonds, values, financial rights, and savings in insurance companies, deposited, managed or obtained abroad

a. Securities or rights located overseas, representative participation in any type of legal entity; values located overseas representative of the transfer of capital to third parties or provided for its management or administration to any legal instrument, including “trusts” though lacking legal personality, capable of acting in the course of trade.

b. Shares and participation in share capital or equity funds of collective investment institutions located abroad.

c. Life insurance (savings not risk) or pensions or annuities, whose insurance companies are located overseas.

3. All types of Real Estate and rights over Real Estate abroad, which include ownership of the property, actual use or enjoyment and bare ownership rights over real estate, timeshares, timeshares shifts, part-time property or similar formulas on real estate, other rights in rem over real estate.

Who is required to file Modelo 720/721?

Are required to file Modelo 720/721 all natural and legal persons resident in Spanish territory, permanent establishments in said territory of non-resident persons or entities, and the entities referred to in Article 35.4 of Law 58/2003.

The holder, representative, authorized person, beneficiary, person or entity with powers of disposal, or beneficial owner, is required to report accounts in financial institutions located abroad, securities, rights, insurance policies, and income deposited, managed, or obtained abroad, and real estate and rights over real estate located abroad.

There is no obligation to report any assets in the block where the sum of the assets does not exceed €50,000. In blocks where the sum exceeds this amount, there is an obligation to report all the assets included. With regard to the block of accounts in financial institutions, it is sufficient that the sum exceeds €50,000, or the sum of the balances as of December 31 of the corresponding year, or the sum of the average balances. In subsequent years, only blocks with an increase exceeding €20,000 compared to the last declaration filed will be reported.

How to complete Modelo 720/721?

Modelo 720 must be completed electronically via the internet and can be submitted either by the taxpayer or by a third party acting on their behalf.

When to file Modelo 720/721?

The informative return on assets and rights located abroad must be filed between January 1 and March 31 of the year following the one to which the information in Modelo 720/721 refers.

Modelo 720/721 must be file for the first time if any of these blocks exceeds the amount of 50,000€ and only the block in which the amount is exceeded and the consecutive years if there is an increase of 20.000€ on the different blocks.

Penalty for not filling, filling incomplete, filing with non-accurate data, will be punished with 5% of the unpaid tax per month, up to 25%, late payment penalty will be 0.5% of the unpaid tax per month. Interest: Accrues daily on unpaid amounts.

Cooperation with other States

On the other hand, Royal Decree approved transposing the EU directive on administrative cooperation in the field of taxation. Thus, reinforcing cooperation in the exchange of information between countries for the liquidation of taxes.

Among other issues, is attributed to the tax agency competition to formulate requests for mutual assistance to other States or international organizations. This provides legal security to achieve greater agility in the process of mutual assistance.

And already a few years ago the tax agency began to provide tax information for citizens of the EU to their respective countries through the Form 299 which is filled by Spanish financial institutions, collected and processed by Tax Authority.

The Government aims to deepen in the coming months in this type of agreement for the exchange of information, both to improve the collection of taxes, and to enhance the fight against tax fraud.

Please do not hesitate to also read our post “Modelo 720 and its repercussions on Modelo 100 and 714”

FAQ: Frequently Asked Questions.

The obligation to submit a report in the case of co-ownership of a good relies on the value of the asset, not in the value of the percentage owned.

1. Modelo 720 must be filed when ownership of a bank account abroad is shared and whose balance on 31 December exceeds the €50.000, but whose ownership corresponds to several people?

Yes, there is a reporting obligation when the balance exceeds €50,000 (if none of the other exceptions to the obligation to declare apply) regardless of the number of account holders. The Modelo will include the total balance, indicating the percentage of participation.

2. Modelo 720 must be filed when sharing ownership of Real Estate located abroad whose acquisition value exceeds the €50,000, on 31 December but whose ownership corresponds to several people?

Yes, there is a reporting obligation when the value of the real state exceeds the €50.000 (if none of the other exceptions to the obligation to declare apply) regardless of the number of owners. The Modelo will include the total acquisition value, indicating the percentage of participation.

3. If a person ceases to be authorized in an account of a financial institution located abroad on June 2012 must file form 720? In this case, which has to be balance and the date to be reported?

There is obligation to declare if the balance that existed in the account on the date of the revocation of the authorization would have determined obligation to declare by 31 December. The balance of the account should be reported on the day of the cease.

4. Is there obligation to declare the pension plans obtain abroad?

No, there is no obligation to include the pension plans, as long as it does not happen the event that implies the distribution of the pension either for life or for a period of time.

5. In the event that the pension plan is distributed should I report the income received?

Yes, in case of any form of distribution, if it happens you should report it.

6. Should I report on stock options?

No

7. Do I need to declare assets which have been sold during the financial year and before 31 December have been reinvested in other assets?

No. When the loss of the status of owner or real owner referred to in the last paragraph of article 42 ter.1 have its origin in the transmission of values and rights, and the amount obtained has been entirely used in the acquisition of other securities or rights, which must be declared. You only must declare the balance on December 31.

8. What exchange rate is used to value goods in foreign currency?

The exchange rate published by the European Central Bank will be used.