Form 721 is the informational return on crypto-currencies and other crypto assets held abroad, created by Law 11/2021 on [fraud](/en/glossary/culpable-insolvency) prevention measures and developed by Order HFP/887/2023. It has been in force since tax year 2023 — with the first filing in January 2024 — and imposes a specific tax obligation on any Spanish resident with crypto assets on foreign exchanges or wallets. In 2026, the entry into force of DAC8 strengthens the AEAT's ability to detect non-compliance.
Origin and regulatory basis of Form 721
The obligation to declare crypto assets held abroad is the direct consequence of growing adoption of digital assets and the concern of European tax authorities to ensure that crypto-asset wealth does not remain outside the tax radar.
Law 11/2021 amended Law 58/2003 (General Tax Law) to introduce two new crypto-asset information obligations: Form 172, for crypto-asset transactions conducted in Spain by service providers, and Form 721, for crypto assets held abroad by taxpayers themselves. The General Regulation on tax management and inspection procedures was amended to govern the content and filing deadlines.
Order HFP/887/2023 approved the official form and set the filing window: 1 to 31 January of the following year. This deadline is shorter than Form 720 for overseas assets (31 March), which requires taxpayers with foreign crypto assets to be aware of this obligation well in advance.
Which crypto assets are subject to declaration
The regulation defines a crypto asset as any digital representation of value or rights that can be transferred and stored electronically via distributed ledger technology or similar. This broad definition covers:
Layer-1 cryptocurrencies: Bitcoin (BTC), Ether (ETH), Solana (SOL), Binance Coin (BNB) and any other cryptocurrency quoted on secondary markets.
Stablecoins: USDT, USDC, DAI, BUSD and similar, regardless of whether they are pegged to a fiat currency or real assets. Their euro value is directly calculable from the EUR/USD exchange rate.
Governance and utility tokens: tokens issued by DeFi protocols granting voting rights or access to services, provided they have market value.
NFTs (non-fungible tokens): NFTs with genuine economic value — especially those from collections with an active market — are included. Valuation of illiquid NFTs requires a documented approach.
Security tokens: tokenised representations of real assets (equities, debt, property) issued on a blockchain.
Crypto assets held on exchanges or platforms with a registered office in Spain should not be included in Form 721, as those entities are already subject to Forms 172 and 173.
Who must file: obligated parties
The following are required to file Form 721:
- Individual Spanish tax residents who hold foreign crypto assets exceeding €50,000 as at 31 December. Tax residency is determined in accordance with Article 9 of the IRPF Law.
- Legal entities and bodies with a registered address in Spain that hold crypto assets with foreign entities or wallets exceeding the threshold.
- Authorised persons or those with power of disposal: those who, without being formal owners, have the power to deal with the crypto assets (access to company accounts, investment funds, etc.).
- Beneficial owners within the meaning of anti-money-laundering rules: individuals who ultimately own or control the assets, even if formal ownership rests with an interposed company.
The €50,000 threshold: calculation and valuation
The declaration threshold is the value of €50,000 for the total foreign crypto assets as at 31 December of the tax year. For calculation purposes:
- Value is determined using the euro-denominated exchange rate for each crypto asset at 00:00 on 31 December (or the closing price on the last business day if the exchange does not operate on that exact date).
- If the taxpayer holds crypto assets on several foreign exchanges, all are aggregated to determine whether the threshold is exceeded.
- Stablecoins are valued at the EUR/USD exchange rate on 31 December if denominated in dollars.
A common question is what happens when the value on 31 December is below €50,000 but was higher during the year. The rule ties the obligation to the value on 31 December, not the annual maximum. However, if the value exceeded €50,000 at some point and was sold before year-end, any resulting capital gains must have been declared in IRPF.
Filing deadline: 1 to 31 January
Form 721 has a filing window of 1 to 31 January of the year following the tax year. For tax year 2025, the window was 1 to 31 January 2026.
This shorter window compared to Form 720 (31 March) is a frequent error among taxpayers with mixed assets — physical assets and crypto assets abroad — who associate both obligations with the same deadline. A taxpayer who files the 721 late but before any AEAT demand incurs reduced penalties; if filing occurs after a demand, the penalty multiplies.
Filing is exclusively electronic, via the AEAT’s electronic office. The form can be submitted directly by the taxpayer (with a digital certificate, electronic national ID or cl@ve) or by a duly authorised representative or tax adviser.
Key differences between Form 721 and Form 720
Although both forms declare overseas assets, there are important differences:
| Feature | Form 720 | Form 721 |
|---|---|---|
| Subject | Physical assets, accounts, securities | Crypto assets |
| Deadline | 1 Jan – 31 Mar | 1 Jan – 31 Jan |
| Threshold | €50,000 per block | €50,000 in aggregate |
| Penalty for omission | €100/item, min. €1,500 | €5,000/item, min. €10,000 |
| Obligation in subsequent years | If increase > €20,000 | If increase > €20,000 |
The Form 721 penalties are fifty times higher per item than those of the current Form 720 (as revised following the CJEU ruling), reflecting the AEAT’s emphasis on crypto-asset wealth control.
DAC8 and automatic exchange of information
The DAC8 Directive (Council Directive 2023/2226/EU), transposed into Spanish law, requires EU-based crypto-asset service providers (CASPs) to automatically report to tax authorities information about their EU-resident clients. The first exchange of information under DAC8 will cover tax year 2025 and will take place in 2026.
For taxpayers, the practical consequence is significant: from tax year 2025, the AEAT will hold directly the balance and transaction data for Spanish clients on regulated European exchanges (Coinbase Europe, Kraken, Binance through its European entities, Bitstamp, etc.) without needing to request it. Discrepancies between what is declared on Form 721 and data received via DAC8 will become one of the main tax audit vectors in coming years.
Non-European exchanges (platforms based in the Cayman Islands, Seychelles, BVI or other jurisdictions outside the DAC8 scope) are not subject to automatic exchange. However, the AEAT can request information via bilateral information exchange agreements or through the Common Reporting Standard (CRS) network.
Obligation to file in subsequent years
Like Form 720, Form 721 does not need to be filed every year if no significant changes have occurred to the declared assets. A new filing is required when:
- The total value of foreign crypto assets increases by more than €20,000 compared to the last declared year.
- The ownership or power of disposal over the crypto assets is extinguished (full sale, transfer to a Spanish wallet, liquidation).
Taxpayers should maintain an up-to-date record that allows them to detect whether any of these circumstances arise before the year-end.
Relationship with IRPF: capital gains and income
Form 721 is informational, but its content is directly cross-checked against IRPF. Crypto assets declared in Form 721 must be consistent with the capital gains and losses included in the savings base of the IRPF return:
- Disposal of crypto assets declared in Form 721 — sale, exchange for other crypto, use as a payment method — generates capital gains or losses that must be declared in the IRPF return for the year of disposal.
- Staking rewards or lending interest on foreign exchanges are typically classified as investment income and must be included in the savings base.
- Swapping one cryptocurrency for another (Bitcoin for Ether, for example) triggers a taxable event even if there is no conversion to euros; the gain is calculated by comparing the acquisition cost of the disposed crypto with the market value of the received crypto at the time of the swap.
Failure to declare gains from crypto assets in IRPF, when the AEAT is aware of the assets via Form 721 or DAC8, constitutes a tax infringement that may be classified as serious, with penalties of 50% to 150% of the unpaid tax.
Best practices and planning
For taxpayers with crypto assets on foreign exchanges, we recommend:
- Reviewing the value of foreign crypto assets in October–November to anticipate whether the declaration obligation will arise as at 31 December.
- Downloading complete transaction records from each exchange at the year-end to correctly calculate IRPF gains and losses.
- Maintaining evidence of the euro value of each transaction at the time it was made, as prices fluctuate significantly and historical valuations can be difficult to reconstruct years later.
- Checking whether any of the exchanges used have been identified as DAC8-reporting providers to anticipate what information will reach the AEAT.
At BMC we advise on preparing Form 721 and on crypto-asset taxation in IRPF, including regularising previous years through a supplementary return where omissions are identified. Consult our tax planning service or contact our tax department directly for a no-obligation initial assessment.
Frequently asked questions about Form 721
What happens if the exchange holding my crypto assets closes or goes bankrupt before 31 December?
If the exchange goes bankrupt or closes during the year and the crypto assets are irrecoverable, a capital loss arises that can be offset against other gains in the IRPF savings base or carried forward for four years. The value to declare on Form 721 would be zero if the assets are no longer available on 31 December, but any assets that remain on other foreign exchanges must still be declared if they collectively exceed the threshold.
Do crypto assets in a cold wallet (hardware wallet) need to be included in Form 721?
It depends. If the hardware wallet (Ledger, Trezor, etc.) is manufactured and supplied by a foreign company and the taxpayer controls their own private keys, there is a doctrinal position holding that the crypto assets are not held abroad but are in the direct possession of the holder. However, the AEAT has not published a general binding ruling on this question. The most conservative position — and the one we advise in conditions of regulatory uncertainty — is to include self-custody wallet crypto assets in Form 721 when they exceed the threshold.
