The EU Council Directive 2011/16 in relation to cross-border tax arrangements, known as DAC6, has been in force since 25 June 2018. DAC6 aims at transparency and fairness in taxation.
DAC6 applies to cross-border tax arrangements, which meet one or more specified characteristics (hallmarks), and which concern either more than one EU country or an EU country and a non-EU country. It mandates a reporting obligation for these tax arrangements if in scope no matter whether the arrangement is justified according to national law.
Failure to comply with DAC6 could mean facing significant sanctions under local law in EU countries and reputational risks for businesses, individuals and intermediaries.
Therefore businesses need to understand the importance and implications of the directive and the need to act now to ensure compliance by the deadline in 2020.
What are the consequences of reporting?
When will reporting commence?
Once the rules become fully applicable (i.e. on 1 July 2020), intermediaries and taxpayers will be required to file information with their national tax authority within thirty days of the first of the following dates:
As a transitional measure, where the first step in a reportable cross-border arrangement is implemented between 25 June 2018 and 30 June 2020, the arrangement should be reported between 1 July 2020 and 31 August 2020.
How can PwC help?
Our team combines experts in tax, people, processes, data and technology. By bringing together these different skill sets, we can help clients to understand DAC6, and the broader tax policy context, and implement effective controls and processes to ensure all reportable cross-border arrangements are proactively identified and managed.
EMEA Tax Policy Leader, PwC Netherlands
Tel: +31 88 792 3611
Dr. Arne Schnitger
Partner, Corporate Tax, PwC Germany
Tel: +49 30 2636 5466
Dr. Astrid Bauer
EMEA and Global Tax and Legal Regulatory Leader, Partner, PwC Germany
Tel: +49 69 9585 1292
Chairman of the Tax & Legal Board and Member of the Board of Management, PwC Netherlands
Tel: +31 887926358