Breaking: Spain Introduces New Crypto Asset Declaration Law for 2024
Spain has mandated its residents to declare their cryptocurrency holdings on non-Spanish platforms. This requirement, announced by the Agencia Tributaria, Spain’s Tax Administration Agency, comes into effect from January 1, 2024, with a deadline of March 31, 2024. The announcement, first made in the Boletín Oficial del Estado on July 29, 2023, introduces form 721, dedicated to the declaration of virtual assets held abroad.
Focus on High-Value Portfolios
However, this directive targets a specific group since only those individuals whose balance sheets exceed 50,000 euros in crypto assets are bound to declare their foreign holdings. This threshold, translating to approximately $55,000, earmarks the move as one targeting substantial investors in the digital currency space. Those possessing self-custodied wallets are not exempt but must report their holdings through the standard wealth tax form 714.
Additionally, the Agencia Tributaria has significantly ramped up its efforts to enforce tax compliance among crypto asset holders. In a notable increase, 328,000 warning notices were sent in April 2023 to those who failed to declare their crypto earnings for the fiscal year 2022. This marked a substantial rise from the 150,000 warnings issued in 2022 and a stark increase from the 15,000 notifications in 2021.
Spain Aligning with EU Regulations
Moreover, Spain is positioning itself as a proactive player in regulating cryptocurrency. The Spanish Ministry of Economy and Digital Transformation reported that the comprehensive European Union framework for crypto assets, the Markets in Crypto-Assets Regulation, would be adopted nationally by December 2025. This implementation is scheduled six months before the EU’s official deadline, highlighting Spain’s commitment to aligning with broader European standards in digital asset management.
In November, further strides were taken in regulatory enforcement when the National Securities Market Commission, Spain’s principal financial regulator, initiated its first case against a technology provider for breaching crypto promotion regulations. This action underscores the country’s dedication to maintaining a regulated and secure environment for digital asset transactions.
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