Blow of the European justice to the Treasury: it knocks down the model 720 that forces to declare assets abroad

The Court of Justice of the European Union (CJEU) has knocked down model 720 of the Tax Agency, which obliges taxpayers to declare assets abroad.

And it has done so, moreover, with some arguments that harshly criticize the activity of the Treasury on this point.

"The national legislation that obliges tax residents in Spain to declare their assets or rights abroad is contrary to Union Law," says the CJEU statement.

It goes on to point out that "the restrictions on the free movement of capital that it imposes are disproportionate" because, it states, "they allow the Tax Administration to proceed without time limitation to the regularization of the tax owed for the amounts corresponding to the value of the goods located abroad. and undeclared.

Therefore, concludes the European justice, "the regulations adopted by the Spanish legislator, in addition to producing an effect of imprescriptibility, also allows the Administration to question a prescription already consummated in favor of the taxpayer, which violates the fundamental requirement of legal certainty ".

The European Commission had already warned in 2017. It then pointed out that the fines imposed by the Treasury on those who do not correctly declare their assets abroad were

, for which required immediate changes or threatens to go to the Community Court of Justice.

Model 720 is an informative declaration on goods and rights located abroad that was approved in October 2012 after a modification of the tax regulations, in the midst of a campaign against fraud.

And it obliges all natural or legal persons resident in Spanish territory and who have current accounts, securities, insurance, income, etc. abroad

.

Treasury penalizes non-presentation, but also errors in substance and form, and Brussels believes that it exceeds.

The Tax Agency stipulates, for example, that "the minimum penalty for failure to submit Form 720 in the first case, in which the three information obligations are not met, would be

. In the second case, in which a single information obligation is breached, the minimum penalty of

.

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