On October 19th 2017, the Tax Office published the CV 2669-17, which deals the obligation to submit a new informative declaration of assets and rights located abroad with respect to a previously informed property when the variation in the exchange rate used to determine its acquisition value has led to an increase in the value of the asset of more than EUR 20.000.
The consultant is the owner of one property located abroad. The purchase price is in a currency different from euro, and he has submitted form 720 last year due the acquisition value exceeds EUR 50.000.
Obligation to declare
In accordance with Article 54a. 1 of the RGAT1, the obligation to declare is established to:
"Natural and legal persons resident in Spain, (…) will be required to submit an annual information form regarding real estate or property rights, located abroad, of which they are owners or in respect of which they have the status of beneficial owners as at 31 December of each year ".
In this sense, for the purpose of delimiting whether the limit of EUR 50.000 of the obligation to inform is exceeded, it shall be determined at acquisition value.
In this case, the exchange rate used to determine the acquisition value shall be that in force on 31st December of the year to which the form relates, since it is on this date that the circumstances of ownership determining the obligation to inform are established.
Determined value acquisition
Therefore, once the acquisition value of the e property has been determined, which in the case in question was greater than EUR 50.000, the variations in the exchange rate occurring in the years following the year of declaration will not be taken into account in determining whether there has been an increase in the value greater than EUR 20.000 for the purpose of submitting a new form.