Spain and offshore Assets

Like most governments in such difficult economic times, the Spanish government is trying to increase tax revenues and has firmly set its sights on offshore assets. There is nothing wrong with owning assets outside Spain, but you need to ensure you declare them according to the rules of Spanish legislation.

 It’s clear that there’s an international move towards the automatic exchange of information, and without doubt, that will provide governments with much more data on undeclared or misrepresented foreign assets and income. The G5 (Spain, UK, France, Germany and Italy) has announced a pilot scheme for the multilateral, automatic and standardized exchange of tax information.

Additionally, in September, the G20 agreed to the introduction of the automatic exchange of asset information, so it does seem to be only a matter of time before details of undisclosed foreign assets will be uncovered

Some people who meet Spain’s residency criteria, do not declare themselves for tax. The tax agency (Agencia Tributaria) has been cracking down on this. They are known to be looking through utility bills and studying lists of foreign children registered in local schools. Then, there is evidence that the tax authority is using information from abroad, and is writing to residents suspected of having undeclared funds abroad.

The Voluntary Disclosure Procedure was a tax amnesty, available last year, designed to encourage taxpayers to regularize undeclared assets. The Agencia Tributaria is now following this up, asking for proof of the source of funds or clarification on discrepancies with data already on file.

In October 2012, the government introduced its new anti-tax fraud law. Included in this, was the obligation to report assets held outside Spain, using Form 720. Speaking in May, Prime Minister Mariano Rajoy said that over 130000 taxpayers had submitted Form 720, declaring assets worth 87 billion euros. However, the Union of Tax Inspectors (GESTHA) reckons the is a derisory number, since there are around 2.6 million foreign residents alone – the group most likely to have overseas assets.

Clearly the taxation of Spain’s foreign residents has been given a lot of effort. It’s doubtful this effort will lessen. Consequently, this raises the question whether or not it’s worth UK nationals moving to Spain, given all the tax increase measures being put in place.

Undoubtedly the answer is a resounding "Si” . However you are advised to acquire some professional advice on taxation in Spain, relevant to your particular circumstances. 

 



Posted by Anthony Bloom from Spanish Property Sales CB. (mail@spanish-property-sales.net) on 10/21/2013 15:07:00


Anthony and Sally Bloom are the founders of the highly renowned property finding business "Spanish Property Sales" covering Moraira, Javea and Benissa coast. Established in 2002, Anthony and Sally have dedicated themselves to advising and helping our many clients realise their dream, whilst ensuring their best interest are secure.

Tags


Comments

No comments.

Add a comment

Sorry, comments are now disabled for this post.