Informative declaration on virtual currencies located abroad. Tax form 721.

Form 721 is an informative tax document stemming from the reform of Spanish Tax Laws concerning anti-fraud measures in July 2021. This revision has extended the form’s applicability to encompass cryptocurrencies held overseas.

Per the reform, individuals possessing cryptocurrency with a portfolio value exceeding €50,000 must file Form 721 between January 1 and March 31. This requirement came into effect with the 2023 tax year, meaning 2024 was the first year in which Form 721 had to be filed under these conditions.

To ascertain the value of your cryptocurrency holdings, you’ll need to compute the average price as of December 31 in each fiscal year. In instances where investors held more than €50,000 at any point within the fiscal year but did not retain that sum by December 31, details about the date when your cryptocurrency portfolio’s value dropped below this threshold must be furnished.

Investors subject to Form 721 requirements who fail to meet the submission deadline will be subject to a penalty of €200. Similarly, investors who submit Form 721 with inaccuracies will incur a penalty of €150.