Spain’s Ministry of Treasury has admitted that Spanish citizens are not forced by law to declare their cryptocurrency holdings under the disputed Model 720, which involves declaring funds held abroad. This duty was established by the Antifraud Law last year, but there is no regulation regarding cryptocurrency since Model 720 was made illegal under European law.
There is no obligation to include crypto in tax statements under Model 720
Spanish Treasury Ministry admitted that current law does not require Spaniards declare cryptocurrency holdings. Model 720 deals with foreign funds. The Spanish Tax Agency confirmed that citizens don’t have any duty to report their cryptocurrency holdings, not even in an informative way, after the underlying ruleset has not been established by the authorities.
This means that citizens need not include any of their crypto-related info in the upcoming Model 720 statement corresponding to last year’s movements, even with the antifraud law approved last year establishing it. Esau Alarcon from Gibernau was adamant about this new development:
You don’t have to declare. You don’t need to provide any information. Model 720 does not contain any cryptocurrency data or values. It is not clear how cryptocurrencies can be declared in the model.
There are no changes in other areas
There were no adjustments in taxation for other areas that included cryptocurrencies. There is no specific place on the income tax form that allows cryptocurrencies to be included. There is one exception to the rule: Cryptocurrencies now require taxpayers to complete a particular area. This is only a formality because many Spanish citizens have already claimed cryptocurrency as their wealth.
There are projects to include cryptocurrencies in a new, updated Model 720 in the future, and that new regulation might be approved for next year’s tax season. Because of the severe penalties it imposed, some Model 720 owners were declared illegal. Some tax payers are being reimbursed from authorities for any penalties they paid.
While the law still requires that cryptocurrency be disclosed, it does not include the EU-recommended penalties.
How do you feel about Spain’s tax treatment of cryptocurrency investments? Leave a comment below.
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