Missed a foreign asset declaration? Late filing and penalties

Key rules

• Old fine: The 150% fine and the rule with no time limit no longer apply.
• Time limit: Hacienda can normally go back 4 years.
• Late filing on your own: The fine is 20 euros per data item, with a minimum of 300 euros.
• Duty to file: You still have to declare foreign assets, and filing before Hacienda asks keeps the cost lowest.

The short answer

File the missing declaration now, on your own, before Hacienda contacts you. That is the cheapest route. The duty to declare foreign assets still exists, and the old, harsher penalties have been removed.

What changed

A 2022 change in the law followed an EU court ruling that the old system was disproportionate. Two things were removed: the special fine of 150% of the value, and the rule that let Hacienda go back without any time limit. Ordinary penalties and ordinary time limits now apply.

How far back Hacienda can go

Hacienda can normally go back 4 years. That period can be interrupted by Hacienda's own actions and by your own acts, such as filing. When the period starts and whether it was interrupted depends on your case, so for older years ask a tax adviser before you assume they are closed.

What it costs

• Filing late on your own, before Hacienda asks: a fine of 20 euros per data item, with a minimum of 300 euros.
• Filing late or not filing after Hacienda asks: a fine of 200 euros per data item, with a minimum of 1,500 euros.

A data item is each separate piece of information you must report, for example each account or property. Late surcharges (recargos) do not usually apply, because this declaration only reports assets and no tax is paid with it.

How to regularise earlier years

1. List every asset you held abroad in each year you missed: bank accounts, investments, property.
2. Work out which years are still inside the 4-year period. Include older years only if an adviser tells you the period was interrupted.
3. File the Modelo 720 for each of those years as a voluntary late filing, before any request from Hacienda.
4. Keep proof of filing and the documents showing where the assets came from.

The income tax risk

Undeclared foreign assets are still presumed to be unjustified gains. The presumption is now softer than before. It is taxed in the year Hacienda discovers it, within the ordinary period, and you can show the assets came from income earned in years that are already closed, or earlier. Keep records that prove this.

Separately, the assets may have produced income, such as interest or rent, that you should have reported on your income tax return. Have an adviser check whether any income tax is due for those years.

Do not wait

Once Hacienda asks, the fines rise and you lose the cheaper route. The warnings and frequently asked questions below cover the common mistakes.

What to watch out for

• Waiting until Hacienda asks: If Hacienda contacts you first, the fines are much higher than if you file on your own. Filing late on your own, before Hacienda asks, carries a fine of 20 euros per data item with a minimum of 300 euros. File the missing years as soon as you can, before any request from Hacienda arrives.

• Assuming old years are safe: Hacienda can normally go back 4 years, and the old rule with no time limit no longer applies. That period can be restarted by Hacienda's actions or by your own acts, so an older year may still be open. Ask a tax adviser to check which years are still open before you decide what to file.

• Undeclared assets taxed as unjustified gains: Assets you never declared can still be treated as unjustified capital gains and taxed as income in the year Hacienda finds them. You can defend yourself by showing the assets came from income of years that are already time-barred or earlier. Keep bank statements and proof of when and how you got the assets.

• Income tax on the assets: Filing the asset declaration late does not settle income tax on interest, rent or gains from those assets. That tax may still be due for the years concerned. Have a tax adviser check whether any income tax is owed before or when you file.

Frequently asked questions

Is the 150% fine for foreign assets still applied?

No, the special 150% fine for foreign asset declarations was removed in 2022 after the EU Court of Justice ruled against it. Late or missing filings now get ordinary fines instead. These are far lower than the old proportional fine.

Do I still have to file after the court ruling?

Yes, the duty to declare foreign assets still exists after the ruling, and only the harshest penalties were removed. If you are above the threshold for a category, you still need to file for it.

Do I pay a surcharge when I file late on my own?

Usually no, because the late-filing surcharges (recargos) apply to tax payments and this declaration only reports assets. You pay the fine instead, and any income tax due on the assets is a separate matter.