The Spanish Ministry of Finance is seeking to enhance its oversight of cryptocurrencies within the country to enable the seizure of digital assets for the settlement of tax debts.
The ministry, led by María Jesús Montero, is in the process of developing legislative reforms to the General Tax Law, specifically Article 162. These reforms aim to empower the Spanish Tax Agency to identify and confiscate crypto assets owned by taxpayers who have outstanding tax obligations.
A royal decree that became effective on February 1 has expanded the range of entities with tax collection authority. Previously, only banks, savings banks, and credit cooperatives could report to the Treasury.
The Treasury is also planning to take a more aggressive stance against tax evasion. It intends to compel banks and electronic money institutions to report on all card transactions.
The rapid implementation of these changes presents regulatory challenges. Spain is actively working on various regulations to govern the use of cryptocurrencies.
In October 2023, the Spanish Ministry of Economy and Digital Transformation announced that the first comprehensive European Union crypto framework, the Markets in Crypto-Assets Regulation (MiCA), will be enforced nationally in December 2025, six months ahead of the official deadline.
Spanish residents holding any crypto assets on non-Spanish platforms must declare them to the tax authorities by the end of the following month.
The submission period for a form 721 declaration began on January 1, 2024, and concludes on the last day of March. Individual and corporate taxpayers must disclose the amount of funds stored in their foreign crypto accounts as of December 31, 2023.
However, only individuals with balance sheets exceeding the equivalent of 50,000 euros (approximately $54,000) in crypto assets are obligated to report their holdings abroad. Those who store their assets in self-custodied wallets must report them through the standard wealth tax Form 714.
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