What Spain’s form 720 is and what it costs today

What form 720 actually reports

Form 720 is not a tax. It is an informative return: it tells the Spanish tax office what you hold outside Spain at 31 December, and it settles nothing. Its legal basis is the eighteenth additional provision of the General Tax Act, which requires residents of Spanish territory to supply that information “conforme a lo dispuesto en los artículos 29 y 93 de esta ley”¹. That clause looks like boilerplate, and it later decides how much a mistake costs.

What is rarely explained properly is that this is not one duty but three, gathered on a single form. The Regulation splits them across three articles and each carries its own €50,000 threshold²:

The three thresholds are never added together. You can hold €30,000 in a Swiss account, €30,000 in an Irish fund and a garage in France bought for €30,000: ninety thousand euros outside Spain and nothing to file. It works the same way in the other direction, which is the uncomfortable part: passing the limit in one block means reporting all of it. If your accounts add up to €51,000, the €200 account you opened to pay a holiday rental goes in too.

There is a fourth duty, limb d) of that same additional provision, added in 2021 for virtual currencies. It does not travel on this form: it has its own, form 721, and we come back to it at the end.

The figure almost nobody measures, and the one measured wrongly

Of the four magnitudes in that table, two cause trouble.

The first is the fourth-quarter average balance. Article 42 bis asks for two numbers for accounts, not one, and its paragraph 4.e) treats them as alternatives: there is no duty when the 31 December balances do not jointly pass €50,000 “y la misma circunstancia concurra en relación con los saldos medios”, and it adds that if either joint limit is exceeded every account must be reported². Either one. Moving your money to Spain on 28 December lowers the year-end balance and leaves the quarterly average untouched, so you file anyway.

The Spanish tax agency settles it with an example worth more than any explanation⁹: an account with €45,256 at 31 December and a fourth-quarter average balance of €58,900. The year-end balance sits nearly five thousand euros under the threshold, and the answer is that it has to be reported.

The second is the value of property. Article 54 bis asks for the acquisition value², not the market value and not a foreign cadastral figure. An apartment bought in Lisbon in 1998 for €40,000 stays out of the return even if it sells for four hundred thousand today. Here the surprise runs the other way: if you bought it in pounds or dollars, that old price is converted into euros at the 31 December rate of the year being reported, not the rate on the purchase date¹¹, so the same property can move in and out of the return as the currency moves.

The threshold counts the whole asset, not your share

This is the trap that catches most people and there is nothing subtle about it: there is no pro-rating.

The tax agency answers it with numbers¹⁰. A foreign account with €150,000 at 31 December, owned by a resident company at 70 % and by an individual at 30 %. Does the individual file, when their share is €45,000? Yes: they “must file an informative return, reporting an account with a balance at 31 December of €150,000, stating that their share in it is 30 %”.

Two consequences follow that surprise people. Four siblings who inherit an €80,000 account all file, even though twenty thousand each is what they get. And an asset held in community of property whose formal title is in one spouse’s name is reported by both: the titleholder with the status “1. Titular” and 100 % participation, and the other as “8. Otras formas de titularidad real” with 50 %¹⁰.

The definition of who is caught is also wider than “owner”. Article 42 bis reaches holders, representatives, authorised persons, beneficiaries and anyone with power of disposal over the account². Being an authorised signatory on a foreign company’s account, or on a parent’s account abroad, counts.

Who is exempt, and an asymmetry that looks unintended

Each of the three articles brings its own list of exceptions, and they are not the same list. The one most used is the bookkeeping exception: assets individually recorded in the accounts fall outside.

For a resident company it works across all three blocks. For an individual carrying on an economic activity and keeping accounts under the Commercial Code, it does not. Bank accounts fall outside under article 42 bis.4.c), and property under article 54 bis.6.c). Securities do not, and the tax agency explains why with unusual candour: being recorded in the accounts “does not exclude the duty to report them, since it has not been included in the rule”¹². The exception was simply never written into article 42 ter. A sole trader with proper books can be exempt on their accounts and their premises in France, and caught by their shares.

The €20,000 rule, and the baseline that makes it hard

Once the form has been filed, it does not have to be repeated every year. All three articles say the same thing: filing in later years is only compulsory when the relevant magnitude “hubiese experimentado un incremento superior a 20.000 euros respecto de[l] que determinó la presentación de la última declaración”².

The word that decides everything is last. Not last year: the last declaration you actually filed, which may be five years ago. And because the rises accumulate against that fixed baseline, two quiet years can oblige you when neither would have on its own.

The agency’s example⁶ shows it with both accounts magnitudes at once. The 2012 declaration was filed on a joint average balance of €55,000 and a joint 31 December balance of €57,000.

In 2014 the year-end balance had only risen ten thousand euros over 2013. A tool holding last year’s figures answers that nothing is due. Against the 2012 declaration, which is the last one filed, the increase is €28,000 and the return is due, and it has to cover every account in the block.

There is a second route that ignores the amount. All three articles close with an “en todo caso será obligatoria la presentación” when you have stopped being the holder, authorised person or beneficiary of something already reported², giving the balance or the value at the date that happened. That is why a cancelled account is reported even when its balance no longer reached €50,000⁹. And by the same logic, if a block was never reported, selling an asset in that block is not reported either: the agency illustrates it with three parking spaces in France valued jointly at €45,000, where selling one the following year is not reportable, while at a €55,000 valuation it would have been⁹.

What the Court of Justice struck down, and what replaced it

This is where almost everything written about form 720 fell out of date.

Until 10 March 2022 the eighteenth additional provision had a paragraph 2 headed “Régimen de infracciones y sanciones”. It classed failing to file on time, or filing incompletely, as a very serious infringement, and penalised it at €5,000 per data item or set, with a €10,000 minimum, or €100 per item with a €1,500 minimum where the return was filed late on the taxpayer’s own initiative¹. Around it sat two more pieces: article 39.2 of the Personal Income Tax Act, which turned an undeclared asset into an unjustified capital gain attributable to “the oldest tax period not yet time-barred” with no evidence admitted against it¹, and the first additional provision of Law 7/2012, which added a 150 % proportional fine on the resulting tax⁷.

On 27 January 2022 the Court of Justice of the European Union gave judgment in Case C-788/19, Commission v Spain⁵. It declared that Spain had failed to fulfil its obligations under article 63 of the Treaty on the Functioning of the European Union and article 40 of the EEA Agreement on three counts at once: the effective imprescriptibility of the undeclared asset, the 150 % fine, and the fixed fines, which bore no reasonable proportion to those imposed for an equivalent domestic failure.

Six weeks later, Law 5/2022 removed all of it. And you can check that without taking anyone’s word for it, by reading the consolidated versions: the eighteenth additional provision went from 1,055 words to 370, article 39 of the Income Tax Act from 255 to 145, article 121 of the Corporate Income Tax Act lost its paragraph 6, and the first additional provision of Law 7/2012 now reads, literally, “(Derogada)”⁴⁷.

But the fines did not disappear, and that reading circulates wrongly too. Along with the special regime went its last line, the one declaring it “incompatible con las establecidas en los artículos 198 y 199 de esta Ley”¹. Removing the special rule and its exclusivity clause in one stroke leaves the general regime in charge. The tax agency confirms it in its own FAQ: the penalty regime applicable to form 720 “es el régimen general establecido en los artículos 198 y 199 de la Ley 58/2003”¹³.

Three details change the final figure. First: article 198.2 does not only halve the penalty, it halves “los límites mínimo y máximo” as well, which is the half of the sentence almost everyone quotes without, and it is why the floor drops to €150 rather than staying at €300¹. Second: the tax agency warns that the penalties “se aplican de forma independiente para cada una de las tres obligaciones de información”¹³, so anyone who misses all three blocks meets the minimum three times. Third: the 30 % reduction for agreeing with the assessment does not reach here, because article 188.1 grants it to “las sanciones pecuniarias impuestas según los artículos 191 a 197” and these are not those¹; the one that does reach is the 40 % of article 188.3, for paying in period and not appealing.

One relief gets overlooked: filing late triggers no surcharge. Article 27.2 computes the late-filing surcharge on the amount payable resulting from a self-assessment or on the assessment derived from a late return¹, and an informative return produces neither.

Why almost nobody noticed

A fair question, if the change is this large: how can the old version still be circulating four years later?

The answer is in how it was announced. Law 5/2022 is titled “amending the Corporate Income Tax Act and the consolidated Non-Resident Income Tax Act in relation to hybrid mismatches”, and its preamble spends 5,257 words across five sections transposing Directive (EU) 2016/1164 on hybrid arrangements. Form 720 appears in section IV, and it gets 67 words: the Court of Justice “ha determinado que determinados aspectos” of the regime “incurren en incumplimiento de la normativa europea”, and it therefore has to be amended⁴. Not one of those aspects is named. In those 67 words there is no 150 % fine, no €5,000 per item of data, not even the word “sanción”. What actually removes them travels further down, in the fourth and fifth final provisions and the sole repealing provision of a law about something else.

There was a notice to read; it simply did not say what had changed. Which is why it is worth distrusting any page about this form that cites neither Law 5/2022 nor Case C-788/19: it was probably written before, or copied from something written before.

A worked example with real numbers

A Spanish resident holds, at 31 December, a foreign investment fund worth €55,900 and a foreign current account whose year-end balance is €45,256 and whose fourth-quarter average balance was €58,900. They also sold an apartment on 30 August, so at 31 December they hold no property abroad. These are the Spanish tax agency’s own figures⁹.

Securities block: €55,900 passes €50,000, so it is reported. Accounts block: the 31 December balance falls short, but the quarterly average does not, and that alone is enough to report the whole account. Property block: at 31 December there is none and its joint value is zero, so nothing is reported, not even the apartment sold. The answer is that form 720 is due for two of the three blocks.

Move one figure. Drop the quarterly average to €49,000 and leave everything else alone: the accounts block disappears from the return with the same year-end balance. That is exactly the mistake any tool, or any page, that only looks at 31 December makes.

Now suppose it was never filed and the tax office comes back three years later, with twenty data items affected in a single block. Under the regime in force that is €20 × 20 = €400, and €240 if paid in period without appealing. Under the regime repealed in 2022 it would have been €5,000 × 20 = €100,000, two hundred and fifty times more, and the asset attributed on top as an unjustified gain to the oldest period not yet time-barred. That distance is why it pays to know what year the guide you are reading was written in.

Now check it on your own figures

The form 720 calculator asks the three questions separately: which blocks pass your €50,000 and on which of the two magnitudes, whether this year’s increase obliges you to file again against the last declaration you made, and what the penalty would be today against the one that applied before 2022.

If what you need is the other side of the same information (what you pay for holding that wealth, rather than how it is reported), the Spanish wealth tax calculator runs on the same valuation rules: article 42 ter.6 of the Regulation sends every valuation on this form to Law 19/1991², which is the statute that page implements.

Crypto assets: form 721

The fourth duty in the eighteenth additional provision, added in 2021, covers virtual currencies held abroad¹. Article 42 quater of the Regulation has implemented it since April 2023 and Order HFP/886/2023 gave it its own form⁸: form 721, with its own €50,000 threshold and the same 1 January to 31 March window. The first year reported was 2023.

Two points decide most cases. First: “held abroad” does not mean what it looks like. Article 42 quater.2 treats currencies as held abroad when whoever custodies them is not required to file the Spanish informative return on virtual-currency balances², so what matters is where the exchange is and what obligations it has in Spain, not where you are. Second: the article reaches currencies “custodiadas por personas o entidades que proporcionan servicios para salvaguardar claves criptográficas privadas en nombre de terceros”². In a self-custody wallet there is no such third party, so that holding falls outside the definition.

The deadline, and a three-day tail

Article 7 of Order HAP/72/2013 sets the window between 1 January and 31 March of the year following the one reported³. The 2025 return fell due on 31 March 2026, which is where the tax agency’s own taxpayer calendar places it, alongside form 721.

If 31 March fell on a Saturday, Sunday or public holiday, article 30.5 of Law 39/2015 moves the deadline to the next working day, which will happen in 2029 and 2030. And there is a tail hardly anyone knows about: article 6.2 of the same Order allows filing during the three calendar days following the end of the window when a technical failure prevents filing online³. Three, not four: forms 347 and 390 get four days from a later general order, and this one keeps the shorter rule in its own.

Filing is online only, with an electronic certificate, the electronic ID card or Cl@ve. There is no paper version.