Mandatory disclosure reporting is required within 30 days of the provision of the CRS avoidance agreement or opaque offshore structure by an organiser or, in the case of a service provider, within 30 days of the initial provision of the services. The information note shows that a provision on legacy information also applies to promoters in relation to RREC avoidance agreements established on or after 29 October 2014. In these cases, notification is required within 180 days of the entry into force of the disclosure obligation. The disclosure obligations under DAC6 apply in principle from 1 July 2020. Intermediaries or users must comply with their disclosure obligation within 30 days of the occurrence of the reportable event (in practice, it can be difficult to determine exactly this date). You must submit the information electronically to the Federal Tax Office (BZSt) using the officially prescribed data set. On 22 October 2019, the Cypriot tax authorities launched a public consultation on a draft law transposing DAC6 into local Cypriot law. The consultation is open until 12 November 2019. In addition, a public consultation on three new reporting templates for cross-border agreements was launched in Spain on 21 October 2019, until 11 November 2019. On 18 October 2019, the Netherlands also published further guidance on the transposition of DAC6 reporting requirements into Dutch national law. An intermediary can only avoid duplication of reporting by demonstrating that it has already properly complied with its own disclosure obligation in another EU Member State or that the relevant information on the same agreement to be declared has already been provided by another intermediary. In particular, in the case of cross-border tax arrangements designed by a user for its own use (internal arrangements), the rules applicable to intermediaries shall apply accordingly. In this case, the user is subject to an independent disclosure obligation.
In other EU Member States, the user may have to ensure that the intermediary complies with its disclosure obligations, failing which the disclosure obligation may fall on the user. EU advisers or intermediaries for individuals and companies established in the Middle East that carry out transactions in or within the EU may be required to make a declaration to the EU tax authorities. Classification as an intermediary does not depend on affiliation to a particular occupational group. In addition to members of the legal, tax and audit professions, financial service providers such as banks, fund originators and insurance companies, as well as asset and investment advisers, including family offices, may also be affected by disclosure requirements in practice. In addition, the Group`s finance companies, in particular, may also be subject to information obligations. Companies in the Middle East”, if they are covered by the regulations, should indicate who has the reporting obligation and whether it is an external consultant who ensures that disclosures are factually accurate before they are made. For each registration received, the Federal Central Tax Office (BZSt) assigns a registration number (“ArrangementID”) to the cross-border tax structure and a disclosure number for the notification received (“DisclosureID”). The intermediary must also inform the user of these numbers.
One of the reasons for this is that the user must indicate in his tax return that a cross-border tax scheme has been implemented; To do this, the user must provide the registration and disclosure number. At the time of publication, seven EU Member States (Austria, France, Hungary, Lithuania, Poland, Slovakia and Slovenia) have introduced binding disclosure obligations based on DAC provisions6. Poland implemented the provisions of DAC6 with effect from 1 January 2019, with the first important deadline for reporting being 30 June 2019. The mandatory disclosure requirements for the other six countries will enter into force on 1 July 2020, in line with the requirements of the Directive. A bill to introduce a form of mandatory disclosure reporting was passed by Mexico`s Chamber of Deputies on September 8, 2019, as part of a broader economic package for 2020. The bill was approved by the Mexican Chamber of Deputies on October 16, 2019 and is expected to be approved by the Mexican Senate by October 31, 2019. The bill would require tax advisors who are responsible for designing, organizing or implementing a reportable system to submit informational returns each February. The directive was implemented in June 2018, but initial disclosures are not due until the end of August this year. However, we must have up to 25.
June 2018 to identify agreements that may be reportable and then report them in the middle of this year. Although the Directive will only apply from 1 July 2020 – in Germany in the form of the national implementing law of 21 December 2019 – urgent attention is needed as the disclosure obligations apply retroactively: in particular, the list aims to clarify when the main assessment of benefits is considered unfulfilled and, therefore, there is no obligation to disclose. In the annex to the draft consultation of the circular on the application of 2 March 2020, the BMF cited the following eight cases: Designing and implementing your long-term compliance programme for EU disclosure obligations (MDR) (pdf) (January 2020) The disclosure obligation for cross-border tax arrangements applies primarily to intermediaries. According to the proposed legal definition, this is primarily any person who designs, markets, organises or makes available for use a reportable cross-border tax scheme or manages its implementation by third parties. The disclosure obligation is linked to participation in the different phases of tax planning, from inception to implementation. However, according to the explanations, a person who has only participated in the implementation of the various steps of a cross-border tax arrangement without knowing it and without reasonably expecting to know about it is not considered to be an intermediary. The main objective of the proposed legislation is to ensure that Guernsey and Jersey comply with their CRS requirements. Therefore, a disclosure requirement for intermediaries for crS avoidance agreements and opaque offshore structures will emerge, both of which are key elements of Action 12 of the OECD-BEPS programme.
Guernsey and Jersey have committed to introducing binding disclosure laws by the end of 2019. Under a recent European Union (“EU”) directive, the EU Disclosure Requirement System (“MDR”) imposes a reporting requirement for potentially aggressive tax planning schemes involving EU member states (also known as “DAC6”). If, for example, there is no intermediary subject to disclosure obligations or if the intermediary is (partially) exempted from disclosure due to obligations of professional secrecy, for example in the case of lawyers, tax advisors and auditors, users (taxpayers) may be subject to disclosure obligations in certain circumstances. A user is any person to whom a reportable transboundary agreement is made available for implementation or who is willing to implement such an agreement or who has implemented the first stage of such an agreement. The disclosure requirements came into force on 25 June 2018. Member States are required to transpose national legislation requiring intermediaries and taxable persons to provide information on reportable agreements from 1 July 2020. The deadline for submission for historical questions was 31 August 2020, with the first automatic exchange between Member States taking place from 31 October 2020. There is a derogation from the Directive as regards the intermediary, as DAC 6 also provides that, under certain conditions, assistance and support services must also be disclosed. In Germany, there is (yet) no disclosure obligation for support intermediaries in the implementing legislation. However, in other EU Member States (e.g. Poland), intermediaries are subject to this requirement.
In March 2020, the Federal Ministry of Finance also published a draft consultation on the application of the provisions on disclosure obligations of cross-border tax arrangements, which is currently being revised by the competent authorities. The final BMF circular is expected to be issued shortly. At present, it is still unclear whether Germany will make use of the possibility under EU law to extend the deadline. There are current signs that this may not be the case. In this case, the old deadlines for old and new cases would remain the same. On the 25th. In May 2018, the Council of the European Union adopted a Directive on mandatory automatic exchange of information in the field of taxation in the context of reportable cross-border arrangements (Council Directive (EU) 2018/822).