A new series of requirements have been introduced by the Spanish Treasury that are applicable to the reporting and taxation of crypto holdings of the citizens. Under the new rules, all taxpayers are obligated to report all their crypto holdings to the country’s taxation authorities. Likewise, they also need to disclose the value of their crypto assets in euros. Plus, they have to provide details of all crypto transactions, including the wallet addresses where they originate and where they are sent.
New Crypto Rules in Spain
Spain is working on developing new taxation rules that will apply to crypto holders in the country. A new set of rules has been put forward by the Spanish Treasury, which will apply to crypto operators and holders in the country. Some of the obligations these rules will impose have been deemed excessive. The Ministry of Treasury presented these new rules, which are still under review and would need to be approved.
As per these rules, Spanish crypto holders would have to provide details of their crypto holdings and disclose the value of the assets in euros as well. These rules are different from what had been proposed earlier. People were not required to provide any information about their holdings and were only obligated to disclose the earnings generated from crypto trading. Crypto exchanges and custody services in Spain would also be obligated to share the same data with Spanish tax regulators.
Apart from holdings, details of crypto transactions will also have to be disclosed, which includes the addresses of their origin and destination, the type of crypto involved as well as its value. But, there is a minimum amount of crypto that people should own before they will have to share this data. If the crypto holdings of the taxpayer are under the threshold of €50,000, they would not be required to declare their holdings to the tax authorities.
The Spanish Treasury is working on coming up with a new model of taxation that also includes cryptocurrencies. Previously, the taxation authorities had had to deal with problems with Model 720, which was applicable to goods and properties held by Spanish citizens outside the country. The European Union had declared the model in question illegal, partly because it included a lot of severe fines.
Keeping the issues in mind, the Spanish authorities are now working on developing Model 721, which outlines all the duties applicable to crypto holders within Spain and outside. If approved, the rules will be implemented in 2023, but would be applicable to the movements that occur in 2022.
Virtual asset service providers (VASPs) that are operating in Spain are also being registered by the Bank of Spain. There are 17 crypto custody providers and exchanges that have already been added to the crypto registry that has been established and more are being added every day. However, there are some big names that have still not been added to this list.