DAC7 - the reporting obligation for digital platforms DAC7 - the reporting obligation for digital platforms DAC7 - the reporting obligation for digital platforms

Business models with digital platforms are booming: accommodation, rental cars, removals, electrical appliances, clothing or toys - goods and services of all kinds are now sold commercially on digital platforms. Time and again, however, this bypasses the tax authorities. The EU states are losing tax revenue in this way, also because they have lacked an instrument for determining and monitoring sales. In addition, this practice of digital platforms constitutes unfair competition with stationary trade.

With Directive (EU) 2021/514 of 22 March 2021, the EU is counteracting this. It obliges the operators of digital platforms to disclose information about transactions of their registered sellers to the European tax authorities. Specifically, this concerns the income generated by the commercial use of the platform - regardless of whether the service or the goods were invoiced via the platform or otherwise.

With the Tax Transparency Act, the new due diligence and reporting obligations were implemented into German law as of 01.01.2023. Although there are still some open questions, the new reporting obligation already exists as of 31.01.2024 for all relevant business transactions of the year 2023. It will then apply to operators of digital platforms in the EU as well as in third countries and to sellers on these platforms. The relevant activities include, for example, the rental of real estate, the provision of personal services, the sale of goods and the rental of means of transport. The first notification is mandatory by 31 January 2024. Some countries, such as the Czech Republic, have already started the legislative process to implement the DAC7 Directive.

The operators of a platform are now faced with the following challenges:

1. Analysis of the affectedness: Does the respective platform fall under the reporting obligation according to DAC7?
2. Data procurement: How do the platform operators obtain the data?
3. Data protection: To what extent must the general terms and conditions be adapted?
   

With the free Atlas assessment „DAC7 Impact“  "DAC7 Impact" you can get a first impression in a maximum of 15 minutes as to whether your platform falls under the DAC7 directive and whether you will have to report the sales of your registered sellers in the future. In addition, we offer you our "DAC7 Impact & Readiness", also free of charge, but a more comprehensive impact and maturity analysis. In 20 to 30 minutes, you will not only receive an aggregated evaluation of the results, but also an overview of the extent to which your current status quo prepares you for the challenges of DAC7. If you are affected, we will be happy to support you in setting up (automated) processes for collecting and reporting the relevant data. We can also advise you on data protection issues*.

You can find our free DAC7 assessments and further information here: DAC7 Impact & Readiness

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For the implementation of DAC7, a Europe-wide consideration is necessary, in particular also of possible exceptional cases in individual countries. DAC7 intends to exempt reporting in all other EU countries if reporting is done in one country for all others. However, this can be thwarted by national requirements.

Below you will find an overview of the status in all EU countries as well as possible special features.