According to new regulations governing the taxation of virtual assets in Spain, the country’s citizens will have to declare foreign cryptocurrency assets in Q1 2024.
The Spanish Tax Agency (AEAT) has published Model 721, a tax return form for virtual assets abroad. The Model 721 filing period will begin on January 1, 2024 and will end on March 31, 2024. Individual and corporate taxpayers will be required to declare crypto-assets to the extent held in their accounts abroad as of December 31.
Among individuals, the obligation to declare their foreign assets will only affect those whose crypto balance exceeds the equivalent of €50,000. Citizens who hold their assets in non-custodial wallets and accounts of Spanish companies will have to report their assets via the standard Model 714.
The AEAT officials have stepped up efforts to tax cryptocurrency holders in Spain in 2023. According to El Mundo, in April 2023, the tax authority sent out 328,000 notices to those who failed to pay taxes on crypto for the 2022 fiscal year. The number of notices increased by 40% compared to 2022, when 150,000 notices were issued, while Spanish taxpayers received only 15,000 such notices in 2021.
The Spanish crypto market in 2023 has been actively developing. In September, the crypto exchange Coinbase received a license to operate in Spain and began providing services to retail and institutional investors.
