Reporting Overseas Crypto Assets Mandated by March 31 for Citizens

Reporting Overseas Crypto Assets Mandated by March 31 for Citizens

Spain Introduces Deadline for Reporting Overseas Crypto Holdings by March 31, 2024

In response to global initiatives aimed at regulating virtual asset taxation, Spain has implemented fresh regulations necessitating residents to disclose crypto holdings on foreign platforms by March 31, 2024.

The Spanish Tax Administration Agency, Agencia Tributaria, has introduced form 721 specifically for reporting virtual assets held abroad.

Under the latest legislation, revealed in the official state gazette on July 29, 2023, the declaration period for form 721 spans from January 1 to the conclusion of March 2024. Both individual and corporate taxpayers are obligated to reveal the amounts held in their foreign crypto accounts as of December 31, 2023.

Importantly, individuals with crypto balances exceeding 50,000 euros (approximately $55,000) are mandated to disclose their foreign holdings. Conversely, holders utilizing self-custodied wallets must report via the standard wealth tax form 714.

This development follows reports seven months prior indicating the Spanish Tax Administration Agency’s intention to issue 328,000 warning notices to taxpayers in 2022—an increase of 40% from 2021. This surge signals an enhanced focus on enforcing tax compliance within the crypto sector, evidenced by a significant rise in warnings from 15,000 in 2021 to 150,000 in 2022.

Moreover, Spain’s oldest law enforcement agency, Guardia Civil, reportedly dismantled a criminal group in August involved in a substantial crypto scam that defrauded over 3,000 individuals worldwide, leading to an embezzlement of nearly $110 million.

Despite intensified regulatory oversight in Spain’s crypto industry, major exchanges continue to expand within the region. For instance, obtained a Virtual Asset Service Provider (VASP) registration from the country’s central bank in June, highlighting the sustained interest and presence of prominent crypto platforms in Spain.

Amid this push for tax compliance, various global governments have intensified efforts to combat potential underreporting of taxable activities in the crypto space. The IRS in the US initiated efforts as early as July 2019, issuing letters to taxpayers engaged in crypto transactions to enhance awareness of tax obligations and rectify past errors.

An international collaborative effort involving 48 countries aimed at combating offshore crypto tax evasion led to a joint statement emphasizing a commitment to global enforcement. The UK-led Crypto-Asset Reporting Framework (CARF) emerged as the OECD’s new tax transparency standard, requiring crypto platforms to share taxpayer information with tax authorities, bolstering worldwide tax compliance.


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