Has your Spanish bank notified you they are going to disclose information about you to the Spanish Tax Office?

Raymundo Larraín Nesbitt, January, 30. 2018

By Raymundo Larraín Nesbitt
Director of Larraín Nesbitt Lawyers
30^th of January 2018

In my article from last December 2017, Non-Resident Income Tax, I wrote on the consequences for non-residents on what is known as the Common Reporting Standard or CRS, for short.

Spain signed in 2014 a treaty, along with over 100 other countries, for cross-border tax co-operation to combat tax evasion. As from 2018, the Spanish Tax Authority (AEAT) will automatically receive a great deal of fiscal information from non-resident owners, including UK and Irish nationals. And by the same token, the Spanish Tax Office will be collating a great deal of fiscal information on you from Spanish banks, and other sources, and sending it back to all those countries that signed the CRS treaty.

One of the (most visible) results of this budding cooperation between tax offices is the letter or e-mail you will have received in January 2018 from your Spanish bank/s informing you they are going to pass along a great deal of fiscal information on you to the Spanish Tax Office, which in turn will relay it over to your home country’s tax office. Sample email from Spanish bank requesting tax information.

Both countries, going forward, will now be busy cross-checking your fiscal declarations and tax residency to catch you out in case you have not been declaring and paying your taxes in your country of tax residence as well as in Spain.

If you are tax resident in Spain, even unbeknownst to yourself, and you have failed to declare your income you may be facing fines for tax model 720 follow a sliding scale. Any ‘incongruity’ is fined starting at €10,000 and any data ‘omitted’ is fined starting at €5,000. Fines can lead up to a staggering 120% of the undeclared amounts you hold abroad on being resident in Spain. The afore does not preclude the fines for Income Tax which additionally can be up to 150%.

Bottom line, for your own sake, if you own assets or derive any income in Spain, get your taxes sorted out pronto because it is a ticking time bomb and time is running against you. Speak to us to sort out your tax matters and become fully tax compliant. We can help you sort out your tax affairs regularising them for a nominal fee for your peace of mind. We only charge for our legal services; a pain-free stomach is gratis.

Larraín Nesbitt Lawyers, small on fees, big on service.

Larraín Nesbitt Lawyers is a law firm specialized in taxation, inheritance, conveyancing, and litigation. We will be very pleased to discuss your matter with you. Please contact us for a free initial consultation. You can contact us by e-mail at info@larrainnesbitt.com, by telephone on (+34) 952 19 22 88 or by completing our contact form.

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Taxation-related articles

Spain’s Wealth Tax Reloaded – 8th September 2011
Spanish Wealth Tax (Patrimonio) – 8th November 2011
Fiscal Novelties Affecting Spanish Property Owners – 8th December 2012
Buying and Owning Spanish Property through Companies: Pros and Cons – 7th March 2014
Taxes on Selling Spanish Property – 8th December 2014
Changes to Spain’s Inheritance and Gift Tax Law – 21st February 2015
La Complementaria or ‘Bargain-Hunter Tax’ – 8th May 2015
Taxes on Buying Spanish Property – 8th July 2015
Dispelling Spanish Inheritance Tax Myths – 8th August 2015
Non-Resident Taxes in Spain – 8th December 2015
Spanish Inheritance Tax for Non-residents (Part I) – 8th February 2016
Spanish Inheritance Tax for Non-residents (Part II) – 8th March 2016
Spain’s Non-Dom Tax Scheme – 8th July 2016
Inheritance Tax Novelties in Andalusia. FAQ on IHT – 8th September 2016
Renting in Spain - Landlord´s Taxation – 8th of January 2017
Renting in Spain: Non-Resident Landlord's Rental Tax Relief – 14th of January 2017
Which beneficiaries are hit worst by Spanish Inheritance Tax (IHT)? – 2nd June 2017
Holiday Home Taxation in Spain – 8th of July 2017
Andalusia to slash Inheritance tax for inheritances under 1 million euros – 21st September 2017
Spanish Inheritance Tax Assessment Report (SITAR) – 8th of October 2017
Non-Resident Income Tax – 1st December 2017
Non-Resident Income Tax – 8^th December 2017
Has your Spanish bank notified you they are going to disclose information about you to the Spanish Tax Office? – 30^thJanuary 2018

Please note the information provided in this blog post is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. VOV.