- Cash payments are now capped, as a general rule, at €1,000, and the fine can reach both the payer and the recipient.
- Virtual currencies come squarely under tax control, with new reporting duties for those who hold or broker them.
- The rules for SICAVs, property valuation and the public list of large debtors also change.
On 10 July 2021 Law 11/2021 of 9 July on measures to prevent and combat tax fraud was published in the Official State Gazette (BOE); it came into force the next day. The law has two aims: to bring a European anti-tax-avoidance directive into Spanish law and to strengthen tax control through a wide-ranging package of measures.
The most visible one affects daily life: the general limit on cash payments falls from €2,500 to €1,000, and to €10,000 for individuals whose tax domicile is outside Spain. But the law goes much further. It requires reporting on virtual currencies, tightens the requirements for SICAVs, bans tax amnesties and replaces the expression “tax havens” with “non-cooperative jurisdictions”.
The new €1,000 limit
The restriction applies to transactions in which a business owner or professional is involved. In practice, any payment above that figure must go by transfer, card or another means that leaves a bank trail. Breaches are punished with a fine proportional to the amount paid in cash, and liability can reach both the person who pays and the person who receives the money.
For shops, restaurants, garages or professionals who deal with private customers, the change means reviewing how they collect payment and what they document. For families, it affects large purchases such as vehicles, jewellery, renovations or furniture. It is wise to keep proof of the payment method used and to remember that, if the buyer lives outside Spain, the ceiling is €10,000.
Cryptocurrencies and SICAVs
On crypto-assets, the law creates two new reporting duties. Those who hold private keys or provide exchange services will have to tell the tax authorities their clients’ balances, and will also have to report purchases, transfers, swaps, receipts and payments. Initial offerings of new currencies will be declared too, and those held abroad will be added to the declaration of assets and rights in other countries.
SICAVs, for their part, will be able to keep the 1 % corporate tax rate only if each shareholder reaches a minimum investment (€2,500, or €12,500 per compartment), so that the wealth is not concentrated in a few hands. Anyone holding shares in these vehicles or owning cryptocurrencies would do well to review how they are declared today and what records they keep.
Reference value and other changes
In transfer tax, stamp duty and inheritance and gift tax, the taxable base moves from being based on “real value” to “market value”. For property, the reference will be the reference value set by the Land Registry (Catastro) from sale prices, with effect from 2022. This is a fundamental change in how the tax due on buying, inheriting or receiving a gift is calculated.
The law also lowers to €600,000 the threshold for appearing on the public list of tax debtors and requires accounting and invoicing software to guarantee the integrity and traceability of records. These measures leave no room for improvisation: anyone planning a property purchase, inheritance or gift should ask their adviser how the new valuation will affect them.
The underlying message is clear: more traceability, more information and less room for cash, and it is worth starting to adapt procedures now.
This article is general information. It is not legal, tax or investment advice, and it does not take anyone’s particular circumstances into account.
