DAC6: EU mandatory tax disclosure rules

Creating transparency

Following on from the introduction of CRS, the OECD’s BEPS initiative and Action 12, the EU has introduced a directive regarding the mandatory disclosure and exchange of information on cross-border tax arrangements. This additional level of transparency serves to detect potentially aggressive tax planning. Known as ‘DAC6’, the directive requires EU intermediaries (including banks, accounting firms, law firms, corporate service providers and certain other persons) involved in cross-border arrangements to make a disclosure to their tax authority if particular criteria – or ‘hallmarks’ – are met.

The first reports are not due until August 2020, but all reportable transactions from 25 June 2018 must ultimately be disclosed. Given the broad scope of the directive, it is important to be considering the impact of DAC6 now, as it may apply to numerous standard cross-border transactions such as cross-border leasing, group corporate structures and securitisation. A normal part of operating in a global economy.

To help you understand more about DAC6 and its requirements, we have compiled some key FAQs along with details of what certain jurisdictions are doing to enforce the directive. Click the link in the right-hand column of this page to read and download our DAC6 fact sheet.