February 2013

tax

CLARIFICATION BY THE GENERAL TAX DIRECTORATE ON THE SCOPE OF THE OBLIGATION TO REPORT ON SHARES AND UNITS OF NON-SPANISH COLLECTIVE INVESTMENT UNDERTAKINGS BY MEANS OF FORM 720


Newsletter 28 warned that the ambiguous wording of the Regulations [1] developing the new anti-tax fraud reporting requirements passed by Law 7/2012 of 29 October 2012 could lead to the conclusion that the reporting obligation also applied to shares and units issued by foreign Collective Investment Undertakings (“CIUs”) “located” (situadas) in Spain, regardless of whether the shares or units were deposited in Spain.

Our previous newsletter highlighted the need for the Tax Authorities to clarify as soon as possible the scope of the obligation to report on any assets and rights located or deposited outside Spain through form 720, specifically, in relation to shares or units issued by CIUs located outside Spain.

Now, and in this regard, the Spanish General Tax Directorate has issued ruling V0741-13, stating that the above mentioned reporting obligation “does not apply to any shares or units which ownership is channeled through a distributor located in Spain or through a representative in Spain of a management company acting under the freedom to render services regime, provided that these shares or units remain registered by their owners in those distributors or representatives of the management company” (underlying added by us).

The rationale behind this interpretation is the fact that when the distribution is carried out through any entity located in Spain or under the freedom to render services regime, these entities assume before the investors and the Tax Authorities a relevant position that implies that they are subject to compliance with certain tax obligations to the same extent as any other management company or any other reporting agent with respect to CIUs issued in Spain. In this regard, the Tax Authorities consider that any reporting obligation by the investor is already “covered by the reporting obligations imposed on the distributor or representative in Spain of the management company”, as it was already argued in our last newsletter.


[1] Order HAP/72/2013 of 30 January 2013 approving the new tax return form 720 and Royal Decree 1558/2012 of 15 November.

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The information contained in this Newsletter is of a general nature and does not constitute legal advice