Displaced workers under the special regime are not required to file Form 720

The management of assets located abroad often generates additional reporting obligations for residents in Spain. However, the nature of the tax regime for displaced workers alters this obligation in specific cases.

What the DGT has ruled

The Dirección General de Tributos (DGT) has determined that individuals covered by the special tax regime provided for in Article 93 of Law 35/2006 (LIRPF) are not required to complete Form 720. This informative declaration regarding assets and rights located abroad aims to inform the Administration about the wealth of those who tax the entirety of their income.

The tax authority's criterion is based on the fact that, under the special regime for displaced workers, the consequences for non-compliance with reporting obligations do not apply in the same way, given that the taxation structure of these taxpayers does not coincide with those who declare their entire worldwide income under the general regime.

What it means for you

If you are a displaced foreign worker residing in Spain and taxing under the special regime of Article 93 of the LIRPF, you do not have to make the informative declaration of your assets and rights abroad through Form 720. This resolution provides legal certainty regarding the exemption from this specific procedure for this group.

It is important to distinguish that this exemption applies exclusively due to the status of being a taxpayer covered by said special regime and not merely due to tax residence in Spanish territory.

What you should do

Taxpayers must verify that their tax situation strictly falls within the requirements of Article 93 of the LIRPF to benefit from this absence of reporting obligation. Since the application of this regime depends on specific conditions of displacement and residence, it is necessary to assess each particular case to ensure that the exemption from Form 720 is applicable without the risk of sanctions by the Administration.