Form 720: assets held abroad
Four independent blocks, a threshold of €50,000 in each and a repeat rule that almost everybody works out wrongly. And no, the 720 was not struck down: what the Court of Justice of the European Union struck down was its penalty regime.
What form 720 is
Form 720 is an informative return on assets and rights located abroad. Nothing is paid for filing it: you are reporting.
It is organised into four blocks that are four independent obligations, each with its own threshold of €50,000:
- Accounts at financial institutions.
- Securities, insurance and annuities: shares, funds, life insurance policies with a surrender value.
- Property and rights over property.
- Virtual currencies, which since 2023 go on a form of their own, the 721.
Who has to file it
Anyone tax resident in Spain who goes over the threshold in any of the blocks. And there are three rules that are systematically applied wrongly:
One: for accounts, two balances are looked at
Not only the balance at 31 December, but also the average balance for the last quarter. It is enough for one of the two to go over €50,000 for the whole block to have to be declared, including the accounts with twenty euros in them.
Two: it is not split by share
Each joint holder counts the whole amount, not their share. That is why a married couple with a joint account of €60,000 both have to file, and almost nobody knows it.
Three: the €20,000 rule is not measured against the previous year
Once you have filed, you only have to declare again if the block has gone up by more than €20,000 compared with the last return filed — not compared with last year — or if you have lost ownership of an asset you declared. You can go five years without declaring and have to do it in the sixth because it has built up.
When the 720 is filed
With the weekend shifts already applied: when the last day falls on a Saturday, a Sunday or a public holiday, the deadline ends on the next working day.
| Period | Deadline | Note |
|---|---|---|
| Full tax year | 1 January → 31 March | The same deadline for the 720 and for the 721 |
It pays to start in January and not in March: asking a foreign bank for the average balance of the last quarter is not something you sort out in an afternoon.
What the Court of Justice of the European Union actually struck down
It is the most widespread myth about this form, and it is worth clearing up precisely.
The judgment of 27 January 2022 declared three consequences of non-compliance contrary to the free movement of capital, not the obligation to declare:
- The classification of undeclared assets as unjustified capital gains attributable to the oldest year still open, with the practical effect of making the obligation subject to no limitation period at all.
- The proportional fine of 150% on the tax due.
- The disproportionate fixed fines.
Spain implemented it with Ley 5/2022, which repealed those penalties and referred the matter to the general regime for formal infringements. That is:
The 720 is still compulsory, and there are still penalties, only now the general ones, which are very much smaller than the old ones. Anyone who stopped filing it because “Europe threw it out” has a problem waiting for them.
The exemption for assets carried in the accounts
There is one situation that matters a great deal to companies: assets recorded individually and identifiably in the accounts of their holder do not have to be declared on the 720.
For an account, that means having it in the accounts with its number, its institution, its branch and its country. It is the one point where keeping the books properly has a direct effect on a reporting obligation.
The mistakes that come up most on the 720
The 720 goes wrong through arithmetic, not through bad faith.
Looking only at the balance at 31 December
For accounts there are two figures, and it is enough for the average balance of the last quarter to go over €50,000 for the obligation to arise, even if the year-end balance does not reach it.
Splitting the balance between joint holders
It is not split: each holder counts the whole amount. That is what makes both members of a married couple with a joint account have to declare.
Measuring the increase against the previous year
The €20,000 increase is measured against the last return filed, however far back that is. A year without an obligation does not reset the count.
Believing the 720 was struck down
What was struck down was the penalty regime and the absence of a limitation period, not the obligation. You still have to declare and there are still penalties, the general ones.
Screenshot of the ERP: the form 720 screen
Where every number on the 720 comes from
Nothing has to be typed in again: the form is worked out from the invoices and the expenses you have already entered during the period.
- Each block is worked out separately, with its own threshold.
- For accounts, both figures are kept: the year-end balance and the average balance for the last quarter.
- The amounts go in whole, not split by percentage of ownership.
- The software keeps the baseline of the last return filed, which is what makes the €20,000 rule come out right.
- And it flags the closures: cancelling an account you declared creates an obligation even if no threshold is passed.
And you can open any box
Every amount on the form can be expanded to see exactly which invoices and which expenses make it up. That is what turns a figure into something you can defend if you are asked.
The 720 comes out of what you have already entered
Free plan forever, no card needed.
Questions about form 720
This page is for information and is reviewed whenever the legislation or the calendar changes. It does not replace your accountant: for your own case, ask someone who knows your numbers.
So the 720 stops taking an afternoon
If the invoices and the expenses are in, the form is already done.
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