What acctually is 720 form?
The Spanish tax form 720 is a declaration of overseas assets held outside of Spain. This Spanish law requires you to provide information about offshore accounts, investments, and real estate located abroad.
Currently if foreigner residents in Spain had assets abroad meaning properties or money in a bank account with more than €50,000 they needed to report these assets to Spanish tax authorities.
If they did not provide this information or the information was incorrect the tax authority was able to punish them with extremely high fines.
Now this structure has been declined illegall, which was approved by the Spanish government. It was recognised as illegal going against the European right of free movement of capital.
This opened up a possibility to claim back fines that could have been given last years.
It also shows that probably the Spanish government will have to change the regulations of this tax form as now it does go against European union standards.
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