DAC 7 new reporting obligation transposed in belgian legislation
The EU institutions introduced new rules that will impact digital platforms and online sellers. These rules are introduced to enforce more transparency. The new obligations will increase data volumes of the affected parties and are a challenge on how to deal with these new data flows.
Belgium has transposed into Belgian law the Council Directive (EU) 2021/54 of March 22, 2021, amending Directive 2011/16 (EU) on administrative cooperation in the field of taxation. This new reporting obligation will bring two important elements into the Belgian law.
Firstly, platform operators will fall under a new declaration obligation. The old “DAC 7 light” obligation will continue to be applicable for a certain period of time.
Secondly, as a result of the administrative cooperation between Member States, the possibility of “joint audits” are introduced. In other terms, this will allow Member States to participate in investigations (e.g.: participate in tax audits meetings, ask questions, etc.) performed by Belgian tax authorities in Belgium towards platform operators located in Belgium. This means that foreign tax authorities are having the ability and possibility to come to Belgium to perform tax audits. However, Belgian tax authorities must give approval.
Which platforms fall under the scope of DAC 7?
There is a broad definition for platforms introduced “any software, including a website or a part thereof and applications, including mobile applications, accessible by users and allowing Sellers to be connected to other users for the purpose of carrying out a Relevant Activity, directly or indirectly, to such users. It also includes any arrangement for the collection and payment of a Consideration in respect of Relevant Activity.”
Platforms that are tax resident in the EU, incorporated in the EU, have their place of management in the EU or have a permanent establishment in the EU are so-called ‘Reporting Platform Operators’. Also, non-EU tax residents, non-EU incorporated platforms or platforms that have a non-EU place of management, may fall under the scope of DAC 7.
If you have any questions regarding this topic, do nothesitate to contact our RSM Belgium | Tax team ([email protected]).