Are you a tax resident in Spain and have investments abroad?

Then you should know what the ETE form is, its purpose, and its submission deadline to the Bank of Spain. If this is your case, you might need to comply with the obligation to declare movements abroad.

In this post, we discuss what residents in Spain must present if they have conducted economic transactions or hold financial assets or liabilities abroad.

 

What is the ETE form?

The ETE form refers to the declaration of foreign movements, used in the fiscal domain to report certain transactions conducted outside Spain.

This form is utilized by several countries and serves two main purposes:

• On the one hand, it aims to record payments and collections made with non-residents.
• On the other hand, it seeks to gather information on assets and liabilities located in jurisdictions other than Spain.

Its primary goal is to ensure fiscal transparency, requiring companies and individuals to report financial assets, investments, etc., exceeding thresholds set by local tax laws.

The following are the concepts to report:

• Shares and other forms of equity participation.
• Securities held with non-resident entities and negotiable securities issued abroad by the declarant.
• Non-negotiable fixed-income securities.
• Temporary acquisitions/disposals and securities lending.
• Loans, credits, deposits, and accounts.
• Land, plots, and real estate.
• Financial derivatives.
• Commercial credits and other transactions.

 

Who is obligated to submit the ETE form?

The first thing to note is that those required to complete the ETE form must be residents in Spain who own assets, rights, or obligations abroad. Both individuals and legal entities (companies) may be required to submit this declaration when:

• They carry out transactions with a non-resident, or;
• They hold assets or liabilities in countries other than Spain.

The Bank of Spain requires individuals and legal entities to report their economic transactions and balances of financial assets and liabilities abroad to this institution.

Regarding limits, it is essential to note that there is no obligation to submit the declaration if the amount does not exceed one million euros, except under express request by the Bank of Spain.

It is also important to remember that to submit the form, you need an activated electronic ID or a valid electronic certificate issued by one of the certification authorities accepted by the Bank of Spain.

 

When must the ETE form be submitted?

This depends on the volume of transactions conducted:

• It must be submitted annually (by January 20) if the transactions in the previous calendar year or the balance of assets and liabilities held abroad is less than 50 million euros.
• It must be submitted quarterly if the transactions amount to at least 100 million euros, but less than 300 million euros.
• Finally, it must be submitted monthly if the transactions amount to 300 million euros or more.

 

Penalties for failing to submit the ETE form

Law 19/2003, of July 4, states that it is considered a serious infraction to:

• Fail to declare operations exceeding six million euros;
• Provide inaccurate data on operations exceeding six million euros.

Penalties for these infractions can reach up to half the amount of the undeclared operation, with a minimum of 6,000 euros.

Additionally, the law considers it a minor infraction to:

• Submit the declaration late;
• Fail to declare operations under six million euros;
• Provide inaccurate data on amounts under six million euros.

Penalties for minor infractions related to the ETE form can amount to up to a quarter of the operation’s amount, with a minimum of 3,000 euros.

For very serious infractions, penalties could reach a minimum of 30,000 euros.

 

Important: Relationship with forms 720 and D-6

The Foreign Transactions Declaration (ETE) is different from forms 720 and D-6. If you want to learn more about the differences among these three, we invite you to read this other post where we go into more detail: Comparison between ETE, D-6, and 720.

 

✅ Do you need help meeting these obligations?

At Adlanter, we have experts in tax advisory who can assist you in fulfilling your obligations related to operations abroad.

Want to learn more about our service? Contact our team of experts without obligation.