Form 721: when to report the cryptocurrency you hold abroad
If you are tax resident in Spain and an overseas provider holds your cryptocurrency in custody, you may need to file Spanish form 721 (modelo 721). The initial threshold is a combined value above €50,000 at 31 December. Grupo Avanza Consultores, tax and accounting adviser in Paterna (Valencia), checks custody, balances and earlier returns, prepares the form and files it with your authorisation. We advise online across Spain and reply in written English by email.
Who needs to check form 721
This guide is for individuals who are tax resident in Spain under the ordinary personal income tax regime. If a special inbound expatriate regime or Basque or Navarre tax rules apply to you, we review your case separately. Article 42 quater.1 of the Regulations approved by Royal Decree 1065/2007 also covers resident legal entities, Spanish permanent establishments of non-residents and certain entities without legal personality. The obligation may cover owners, beneficiaries, authorised persons, people with powers of disposal and beneficial owners.
The key question is who holds the private keys in custody. The app’s brand, website country or trading currency is not enough: identify the legal entity providing custody. Under the rule, crypto is located abroad when its custodian is not subject to the Spanish reporting obligation in additional provision thirteen.6 of the Personal Income Tax Act. The Tax Agency describes this as a non-resident provider without a permanent establishment in Spain.
Above €50,000 across all currencies and custodians
For the first return, add together the euro value of the foreign-held virtual currency balances at 31 December. The threshold applies to the total, not separately to each platform or cryptocurrency. If the total exceeds €50,000, all currencies within the obligation are reported. If it does not exceed that figure, this exemption applies, subject to events ending a previously reportable status in later years.
There are also accounting exemptions for certain entities and for individuals carrying on a business who keep accounts under the Spanish Commercial Code, with the coins individually identified. A personal transaction spreadsheet does not by itself establish that exemption (article 42 quater.5).
If you control your own private keys
Coins in a non-custodial wallet, with private keys under your control, are excluded from the form 721 calculation. The Tax Agency says actual custody determines this, whether the wallet is hot or cold. Separate your own wallets from each account where a third party provides custody.
The form 721 deadline for 2026
The ordinary filing window is 1 January to 31 March of the following year. Information for the 2026 reporting year is therefore filed from 1 January to 31 March 2027 (article 4 of Order HFP/886/2023). If an earlier return is missing, we first check the year and its supporting records before preparing a late filing.
When you need to file again
In later years, a new return is only required when the combined year-end balance increases by more than €20,000 over the balance that triggered the last return. There is one exception: anyone who, by 31 December, has stopped being the holder, authorised person, beneficiary, person with powers of disposal or beneficial owner reports the balances at the date that status ended, and in that case the regulation requires the return to be filed in any event (article 42 quater, sections 1, 4 and 6).
Before filing, we check the year’s purchases, sales and transfers and the last return; comparing two balances is not enough.
The records we need
- The reporting year, your tax residence and previous form 721 returns with filing receipts.
- The custodian’s legal entity, country, tax identification where applicable, and address or website.
- Each currency, its units and euro value at 31 December; if the end of a reportable status must be reported, at the date that status ended. In both cases, the price or source used.
- Sales, transfers and changes of custody, with dates, to check any end of a reportable status.
Balances reported at 31 December are valued using the price on that date from leading trading platforms or price-tracking websites; if none is available, a reasonable estimate of the euro market value is used, identifying the value applied (article 42 quater.3.c). If the end of a reportable status must be reported, the information, balance and valuation relate to the date that status ended (article 42 quater.1 and 4). Keep the provider’s reports and the valuation evidence for the relevant date.
How Grupo Avanza Consultores helps
We check whether a return is due, reconcile the records you supply from custodians and wallets, review earlier years and prepare the return and its authorised filing. Form 721 is an information return, separate from form 720 for other assets abroad; it does not replace a review of your other tax obligations. We reply in written English by email.
Official sources
Consulted on : article 42 quater of Royal Decree 1065/2007, introduced by article 3.9 of Royal Decree 249/2023 and in force since 25 April 2023; Order HFP/886/2023, articles 1–5, first applicable to the 2023 reporting year; and the Spanish Tax Agency’s FAQs on who must file and private wallets, exemptions and the threshold, custody abroad, reportable data and deadlines, later years and ended holdings. The linked official texts are in Spanish.
Frequently asked questions
Questions about crypto and form 721
Do I need form 721 if I have not sold anything?
Possibly. The initial obligation depends on foreign custody and a combined value above €50,000 at 31 December, not on selling coins or withdrawing money.
Is the €50,000 threshold separate for each platform?
No. Add together all foreign-held virtual currencies within the reporting obligation, even if several custodians hold them. If the combined limit is exceeded, all those currencies are reported.
Do coins in my own wallet count?
No, if you control the private keys and no third party holds them in custody for you. The Tax Agency says actual custody matters, whether the wallet is hot or cold.
Does selling everything remove the obligation in later years?
Not necessarily. If selling means you stop being the holder, authorised person or beneficiary of those coins, you report the balances at the date that status ended and, in that case, the regulation requires the return to be filed in any event (article 42 quater, sections 4 and 6). We check each case.
Related services and guides
We check custody and balances before preparing form 721
Tell us the reporting year, when you became tax resident in Spain, which entities hold your coins in custody and whether you have filed form 721 before. Tell us which records you have. We reply in written English.