EU Commission extends deadlines for VAT e-commerce rules, DAC reporting

By Julie Martin, MNE Tax

The EU Commission has announced that, because of the COVID-19 emergency, it will postpone the entry into force of the VAT e-commerce package and will extend deadlines for the Directive on Administrative Cooperation (DAC), including deadlines associated with reporting on cross-border tax planning arrangements (DAC6).

The VAT e-commerce rules will now apply from July 1, 2021, instead of January 1, 2021, giving the Member States and businesses more time to prepare, the Commission said in a May 8 statement.

Member States are given three additional months to exchange DAC6 information on cross-border tax planning arrangements, though this deadline may be later extended an additional three more months, depending on the status of the outbreak.

It is important to note that DAC6 will continue to apply from July 1; the reporting of arrangments that fall within the postponement period has only been deferred.

Member States are also given three more months to exchange information on financial accounts of which the beneficiaries are tax residents in another Member State. That period may also later be deferred an additional three months, the Commission said.

As is the case with DAC6, the information on financial accounts to be exchanged during the deferral period must be reported once the deferral period is over.

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Julie Martin

Founder & Editor at MNE Tax

Julie Martin is the founder of MNE Tax. She edits the publication and regularly contributes articles on new developments in cross-border business taxation.

Julie has worked as a tax journalist and editor for more than 13 years. Prior to that, she worked as an in-house tax attorney in New York. She also holds an LLM in taxation from New York University School of Law.

Julie can be reached at [email protected].

@mnetax

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Julie can be reached at [email protected].