On October 25th, 2016, the Treasury department of Spain passed the law HAP/1695/2016 which approves the Form 289 “Information return on financial accounts”.
This information return aims to fulfill the obligations assumed by Spain to enlarge the exchange of tax information within countries. Until now, has only exchanged this financial information with the United States of America for the years 2014 and 2015.
As of the enforcement of this law, this obligation to exchange tax information will apply to many countries and, therefore, the Spanish financial institutions should report the financial assets in Spain held by non-tax residents’ individual.
In general, the financial entities are obliged to report the financial accounts heled in Spain or authorized to dispose by individuals or entities with a tax residency outside Spain.
Some of the details and information that should be reported are the following:
- Identification on of the financial account, indicating the IBAN or ISIN code of the bank account or investment portfolio respectively.
- Value of the financial account: E.g. balance of the bank account at year end.
- The date of closed in case the financial account had been closed in the year.
- Identification of the individual or entity owner of the financial account or with the authority to dispose.
Under some requirements, the collective investments funds will be exempt of this obligation, and will not have to submit this annual form 289.
This annual form must be submitted via the internet between January 1st and May 31st of each year for the preceding year. The first return will be the corresponding to the year 2016, and should be submitted in 2017.
The mentioned law has introduced others news and changes:
- Tax Identification number and Tax Form 291 “Information Return. Non-resident income tax. Accounts of non-residents without a permanent establishment”: It has been modified the communication that non-residents without permanent establishment in Spain and the tax residency in other country should do to financial entities to apply the exemption of the obligations to communicate the tax identification number in the transactions with financial entities and non-withhold on the interest obtained from bank accounts.
- Changes to Tax Form 290 “Annual informative statement on the financial accounts of certain United States citizens (FATCA)”: The deadline to submitted the form has been extended from 1st of January to 31st of May of each year in relation with the financial accounts of the preceding year. Until now, the deadline to submit the tax form finished the 31st of March.
B LAW & TAX
ASESORES FISCALES INTERNACIONALES