Lou71

Ouch, no thanks, that sounds hellishly complicated. Glad I've got an EU passport!

agree_to_disagree

Have you done a 720 for shares, yourself?

astera

No, but I'm moving here next year and will have to look into it. But from your response I take it this isn't something that you should do on your own but rather pass it on to someone who deals with these matters on an everyday basis?

Is that the case with tax matters in general? As in don't touch these things yourself but let an experienced professional do the paperwork for you?

Chipmonk

720 should be done by a Spanish speaking lawyer/ gestor. Even very small errors ( dates, addresses etc) can technically give rise to huge fines!!! Even admitting to a mistake leads to a fine.
Tax should also be done by done by a professional if it's the first time. People with the same financial numbers each year tend to just copy previous years declarations but in reality the vast majority dont really know what the different parts of the form mean- so it is easy to make a mistake and if investigated it would be difficult to explain if you never really understood what you were doing

astera

Right, so quite an unfriendly system then. Just curious but when you mean huge just how much have people been fined for small errors like dates or addresses?

This is completely different than what I'm used to but I guess I'll have to adjust and get someone to do this professionally.

agree_to_disagree

The fines are so big that you would have to be this guy, to be able to afford the fines!

Chipmonk

Technically just a small error can entail a 1,000 euros fine then each subsequent error gets accumulated fines. Its seems crazy but unfortunately the law was seen as targeting money-laundering but somehow seemed to hit fairly honest folk with assests like properties and shares. It certainly does happen as my wife used to do tax returns for foreigners and she often lamented the fines poor Scandanavians faced for forgetting to declare tiny share holdings. The EU has been looking into it for years and has rebuked the Spanish government but as with Labour reforms and pensions these things simply never get rectified despite all the legal rulings

agree_to_disagree

The point is that I have had both sole trader and Ltd company businesses in the UK, so I was well accustomed to the rigor and attention to detail that a tax return required.

However, what placed the 720 on a different level was the fines for making ANY errors.

Further to what chipmonk stated above I think when the 720 was first brought in they did dish some hefty fines, but since the EU have kicked up a fuss about it, I think the number of fines has dwindled.

astera

The UK and many other Western countries have gone off the rails when it comes to these matters. I just read about someone with a UK Ltd company who got taken to court by the overseers because they didn't like the way he structured his salary and dividend ratio. Wow. Took a while but at least he won so UK courts delivered justice in the end.

Seems like Spain is on an entirely different level though, so I'm not leaving anything up to chance as I certainly don't want any fines or even any sort of turbulence along the way. I want plain sailing from A to Z without any issues.

How much are we looking at for handling a tax return and then the 720?

agree_to_disagree

Ltd company structure in the UK was a tax avoidance ploy used by contractors for many years. Just recently the UK government has cracked down on it. Anyone who set up a Ltd company as a contractor knew what they were getting into and understood the risks. No sympathy whatsover for anyone being dragged over the coals by HMRC. The Ltd company enabled you to receive the minimum possible salary with maximum amount possible paid as dividends, thereby minimising tax paid. However, as you also draw Spain into your comments above. The Ltd company and sole trader models are infinitely better than their equivalents in Spain!

My 720 costs hundreds as I get charged a fixed fee per share but they they apply some random discount and almost half what that charge. I only declare UK shares and do not declare a UK property on mine. Best indicate what you need to declare in an anonymous way and then perhaps others on this forum can advise you what you might expect to pay and make recommendations about who you could approach to do your 720.

Fred James

A joint tax return should be about €200 unless you have a very complicated income structure. I have done my tax declarations online for 20 years and it takes about 10 minutes once you have the basic income figures together.

Asset declaration of course could be much more complicated if you have multiple assets in different categories and, yes, fines for incorrect or late declarations are high but these fines are being reviewed by the EU as extortionate. In the case of non declaration of assets the fine can be 150% of the asset value!

astera

That's the difference between the US and the UK for instance when it comes to the "small guy." In the UK you can get harassed for simply setting your wages and dividends in a perfectly legal way simply because the overseers don't like it. In the US the courts would quickly find this accusation laughable (the same conclusion the UK courts came to but after a much longer period of time).

That's what currently worries me about the UK. Do something legally and you could still be thrown under the bus. Same with estate tax. Parents donate property to their child(ren), they in turn don't immediately extort rent from their parents (gratitude vs complete lack thereof!), and suddenly the overseers can just say the property transfer never happened. Wow. So once you have the property in your own name you actually do not have the right to do whatever you want with it.

If the UK is THAT BAD (and bound to get worse due to crumbling finances), I'm scared to think what Spain could be like if those with recent UK experiences are giving off warnings. Seems like it's best to keep things simple and definitely get someone to file all documents in a professional matter.

astera

That seems reasonable, and my income structure will be the easiest part I think (though here I will have to keep track of any football bets I do in case there is a profit in the end!).

Asset declaration might be time-consuming because I have several accounts will small balances that I just leave active in case I ever relocate back to that country (given how opening a new account is getting more tedious by the year almost everywhere). So not much work in terms of counting assets but just lots of tiny stuff to deal with in all the different currencies. Would definitely help if accounts with virtually insignificant balances didn't even have to be taken into account...

snikpoh

For a joint tax return, our gestor charges 40€

Fred James

You are lucky. All the gestors here charge a lot more.

Its a rip off as it takes them 10 minutes and its your fault if they get it wrong! I have done it myself for 20 years.