- The tax authority approved the income tax and wealth tax forms for 2016, published in the State Gazette on 23 March.
- The campaign opens on 5 April online and ends on 30 June, with appointments from 4 May.
- Before filing, check the draft against your own data and remember that the form 720 deadline ends on 31 March.
On 23 March 2017 the State Gazette published Order HFP/255/2017 of 21 March, approving the personal income tax and wealth tax return forms for the 2016 tax year. The income tax campaign will start on 5 April, online only, and run until 30 June. Appointment requests will open on 4 May and in-person service will begin on 11 May.
For those who file with direct debit, the last day is 26 June, and 29 June is the limit for requesting an in-person appointment. For many families it is the only return of the year, and refunds, payments and data carried from one year to the next depend on it. It is therefore worth reviewing calmly both the draft and the tax data held on the tax authority’s website.
What is declared and when
The income tax return gathers the previous year’s income, whether from work, capital, business activities or capital gains, and applies reductions, personal and family allowances and deductions. Not every taxpayer must file: it depends on the source and amount of income, but filing may be advisable if a refund is pending or there are deductions to claim.
Wealth tax is levied on net assets at 31 December. Its tax-free allowance and application depend on each region, and those who file must declare assets, rights and debts. For shares listed on organised markets, an order published in February set the average trading value for the fourth quarter of 2016 for the purposes of this tax.
Data worth checking
The draft is prepared from information the tax authority has received from third parties, such as employers, banks or registries, and does not always reflect the whole personal situation. It pays to check that all income appears, along with address and children data, pension plan contributions, rentals, regional deductions and the gains or losses from selling property, shares or funds. Tax data can be consulted and, if the information received is wrong, corrected before confirming.
It is also wise to organise the paperwork: withholding certificates, proof of deductible expenses, deeds and investment statements. If the draft does not match reality, it can be modified before it is confirmed. And anyone who spots an error after filing can amend the return, something best done as soon as possible to avoid surcharges or penalties.
What to review
The form 720 deadline ends on 31 March. It is the informative return of assets and rights abroad, which obliges those who exceed certain amounts in accounts, securities or property outside Spain. It is separate from the income tax return, but many families have it pending: it is worth checking whether it applies while there is time. Where the value of assets abroad exceeds the limits, omission can lead to significant penalties.
With more complex wealth, the campaign calendar invites early preparation: gathering data, weighing tax options and consulting the adviser about doubts on sales, inheritances or income earned in another country. A careful return is filed with more peace of mind than one done at the last minute.
Checking the draft well today saves amendments, surcharges and surprises tomorrow.
This article is general information. It is not legal, tax or investment advice, and it does not take anyone’s particular circumstances into account.
