After the first cancellation of a penalty for submitting the Form 720 out of time, the TEAC has cancelled another penalty of this kind.
Since the first cancellation of a fine, imposed for submitting the form 720 out of time, It seems that the Central Economic-Administrative Court is now thoroughly reviewing each judgment.
Recently, another similar penalty was cancelled. On this occasion, the affected person is a taxpayer who, in 2012, the year in which the form came into force, submitted it after the deadline.
The Spanish Tax Office investigated her assets abroad and decided that there were unjustified capital gains. The Tax Office considered that two serious infractions were committed. The first one, for failure to pay the debt from art. 39.2 LGT, for which a fine of 150% was imposed, which was finally cancelled. And the second one, for the lack of submission of the form 720 of 2012. Both amounted to a total of 3,000€.
In these circumstances, the Court assumed that the taxpayer was not aware of her obligation until she filed the annual Tax Return in June, and by the time she knew it, the deadline was over. Even so, the taxpayer decided to submit the form out of time, and that is the reason why the TEAC considered that there was no evidence to suggest that the taxpayer wanted to keep the goods hidden.
That is why it is necessary to differentiate between the behavior of a taxpayer who intentionally conceals the goods abroad; from the one who does not have the intention to hide them, and fulfills his obligation even when the deadline is over.
The Central Court finally decided to cancel the penalty because there is no evidence of guilt, and they had in mind that the penalty is imposed in a general way to every taxpayer who submits the form out of time.
B Law & Tax
International Tax & Legal Advisors