Ingrid is Swedish, has lived in Marbella since the summer of 2021 and has been tax resident in Spain since that year. She brought what she had with her: an account at Handelsbanken with about 180,000 euros and a portfolio of Luxembourg funds worth a little over 95,000 euros. Nobody mentioned Modelo 720, the Spanish return that reports assets held abroad, until a friend said at dinner that she files it every March. Ingrid has gone five tax years without filing it, and the question she asks is the one almost everyone in her position asks: how much is this going to cost me?
The short answer is that, if she moves before Hacienda (the Spanish tax authority) writes to her, a good deal less than she fears. The long answer depends on three things worth separating from the start: which years are still open, what fine is left today for not having reported, and above all whether those assets produced income that never went through her income tax return either.
Why a forgotten 720 is no longer what it was before 2022
For almost a decade, the 720 had its own penalty regime that turned an administrative oversight into ruin: fixed fines for each item of data, very high minimums and the possibility of treating unreported assets as a gain that never became time-barred. The judgment of the Court of Justice of the European Union of 27 January 2022 (case C-788/19) held that system contrary to the free movement of capital, and Law 5/2022 abolished it.
What has remained since then is the general regime of Law 58/2003, the Ley General Tributaria (the General Tax Act), for information returns. We explain it in detail in the guide on 720 penalties after the CJEU judgment, but the practical idea is simple: filing late without having been asked to now carries a limited and predictable consequence.
The tax years Ingrid has to file now
The 720 is filed from 1 January to 31 March and reports the position at 31 December of the previous year. The offence of not filing it becomes time-barred four years after that deadline ends. With that, Ingrid's calendar at the end of September 2026 looks like this:
| Position at 31 December of | Deadline she had | Status today |
|---|---|---|
| 2021 | Until 31-3-2022 | Time-barred since 31-3-2026 |
| 2022 | Until 31-3-2023 | Open: it is filed |
| 2023 | Until 31-3-2024 | Open: it is filed |
| 2024 | Until 31-3-2025 | Open: it is filed |
| 2025 | Until 31-3-2026 | Open: it is filed |
Four returns, one per tax year, each with the balances and values of its own 31 December. Filing only the latest one "to catch up" does not work: each year's obligation is independent, and since Ingrid never filed any, the rule that exempts you from filing again unless there is a rise of 20,000 euros does not help her yet. That rule only works once a first return has been filed.
If you would rather have someone review your open years first and tell you which ones really have to be filed, you can tell us about it in the Modelo 720 form; with your figures the exact calendar comes out.
The fine that is left today, with Ingrid's numbers
Article 198 of the Ley General Tributaria penalises failing to file an information return on time with 20 euros for each item or set of data relating to the same person or asset, with a minimum of 300 euros and a maximum of 20,000 euros. If the return is filed late but without a prior request from the tax authority, the penalty and its limits are halved.
Ingrid has two assets to report each year: the account (key C) and the funds (key I). Even if several sets of data were counted per asset, she would not reach the minimum, so the calculation is this:
- Penalty per tax year, filing on her own initiative: the reduced minimum, 150 euros.
- Four open tax years: 4 × 150 euros = 600 euros.
- If she pays within the voluntary period of the assessment and does not appeal it, the 40% reduction for prompt payment in article 188 also applies: 600 euros × 0.60 = 360 euros.
That is the 720 part. Compared with the minimum of 10,000 euros per return that was imposed before 2022, it is a different scale. But it is not the whole bill.
What is not in the 720: the income that was never declared
The 720 only reports what you own. What those assets produce goes in the income tax return (IRPF), and that is usually where the real money is. In Ingrid's case:
- The Swedish account paid her interest, about 3,200 euros a year on average. That is income from movable capital and is taxed in the savings base, at 19% in that band: about 608 euros of tax per year.
- The Luxembourg funds are accumulation funds and she has not sold them. As long as there is no redemption there is no income to declare in IRPF, although they do have to be reported in the 720. It is a detail that takes a weight off many people's shoulders.
The IRPF returns for 2022 to 2025 are corrected with supplementary self-assessments, each with its recargo under article 27 (the surcharge for filing late on your own initiative). Filing everything in mid-October 2026, the approximate result is this:
| IRPF for | Tax omitted | Delay | Recargo | Recargo with the 25% reduction |
|---|---|---|---|---|
| 2022 | 608 euros | More than 12 months | 15% = 91.20 euros | 68.40 euros + interest |
| 2023 | 608 euros | More than 12 months | 15% = 91.20 euros | 68.40 euros + interest |
| 2024 | 608 euros | More than 12 months | 15% = 91.20 euros | 68.40 euros + interest |
| 2025 | 608 euros | 3 full months | 4% = 24.32 euros | 18.24 euros |
On top of the tax itself (2,432 euros in total) come about 223 euros of reduced surcharges and late-payment interest for the first three years, which on amounts like these is a few tens of euros. The IRPF for 2021 became time-barred on 30 June 2026. Altogether, regularising costs Ingrid about 3,000 euros, almost all of which is tax she should have paid anyway. The order in which to file the returns when there are several years is covered in the order for regularising several tax years.
Where the money came from, the question that comes next
When Hacienda receives a late 720 with 275,000 euros abroad, it is reasonable for it to ask where that money came from. Law 35/2006 on IRPF allows assets that do not match declared income to be treated as an unjustified gain. Since the 2022 reform that rule once again accepts proof that the assets were acquired with declared income or in a tax year that is already time-barred.
Ingrid has it easy if she keeps her paperwork: the Swedish balance comes from her salary in Stockholm before she moved, when she was not resident in Spain. The statements for 2020 and the first half of 2021, her Swedish payslips and her Swedish tax return for those years are the proof. It pays to gather them before filing, not when the letter arrives.
Everything above depends on filing before any action by the tax authority aimed at regularising that obligation. A formal request, a notice opening a review and, depending on their content, some letters from the Agencia Tributaria change the calculation: the fine is no longer halved and in the income tax return the penalty appears instead of the recargo. What counts as a prior request and what does not is explained in this guide. When in doubt, read the letter before filing anything.
What hardly anyone tells you about a late 720
First, the information is already in Hacienda's hands. Sweden, like the rest of the European Union and more than a hundred countries, sends Spain the account balances of its residents every year through the common reporting standard. A late 720 does not reveal anything: it puts you on the right side of a figure the tax authority already has.
Second, once the late returns are filed, next year you may not have to file. If no block rises by more than 20,000 euros compared with what you last reported and you close nothing, there is no obligation to file again. When there is one is set out in when the 720 has to be filed again.
And third, the risk is not something that can be warned about or ruled out in the abstract: it depends on the proof of origin, on the dates and on whether there was any prior contact with the tax authority. That is why the review is done before filing, with the statements in front of you.
Two questions people ask us about a late Modelo 720
Should I wait and see whether they ask me for the Modelo 720?
No. With Modelo 720, when it is filed late, the recargo in article 27 of the Ley General Tributaria goes up one point for each full month of delay, and after twelve months it becomes 15% plus interest. But that is not the expensive part: the moment a request arrives the recargo disappears and what opens is penalty proceedings. The difference between moving today and waiting for them to move is usually thousands of euros.
Do I have to file it every year?
No. Once filed, you only report again if a block rises by more than 20,000 euros compared with the last return, or if something is closed or transferred. But it has to be checked every year.