DAC 6 – Mandatory Disclosure Rules for Cross-Border Tax Arrangements

DAC 6 (Directive 2018/822/EU) is the sixth amendment to the EU Administrative Cooperation Directive and introduces reporting obligations for cross-border tax arrangements. It implements OECD/G20 recommendations on Mandatory Disclosure Rules (BEPS Action 12) at EU level.

• Intermediaries (tax advisers, lawyers, banks and others) are required to report reportable arrangements to tax authorities.
• Hallmarks: Specific hallmarks (categories A–E) define which arrangements are reportable — including aggressive tax planning patterns, use of loss carry-forwards, and circumvention of information exchange obligations.
• Data exchange: Reported information is automatically exchanged among all EU member states.
• Subsidiarity: If an intermediary is bound by professional privilege, the reporting obligation shifts to the taxpayer.

DAC 6 is rooted in the OECD BEPS initiative and in particular the final report on Action 12 (2015), which recommends minimum standards for mandatory disclosure rules on cross-border tax arrangements. The European Commission published its proposal in June 2017; Directive 2018/822/EU was adopted by the Council of the EU on 25 May 2018.

The reporting obligation initially applied retroactively to arrangements from 25 June 2018. Due to the COVID-19 pandemic, the EU deferred the original deadlines: reports due by 30 June 2020 were pushed to 31 January 2021. Regular operations commenced on 1 July 2020 with the first automatic data exchange in April 2021.

DAC 6 applies to all 27 EU member states and covers cross-border tax arrangements involving at least one EU member state. Reporting is primarily required from intermediaries (advisers, promoters, implementers) with an EU nexus. The directive covers arrangements relating to direct taxes; VAT, customs duties and social security contributions are excluded.

• Report of reportable arrangements within 30 days of availability, readiness to implement, or first implementation step.
• Mandatory disclosures: identification of intermediary and taxpayer, hallmarks triggered, summary of the arrangement, reference value, applicable member states.
• Automatic exchange of reported data every three months between member states.
• Effective, proportionate and dissuasive penalties for non-reporting (implemented nationally).
• Retention obligations and processing documentation under GDPR.

1 correction:
- DAC6: Catch-up deadline is February 28, 2021, not January 31