On 24 June 2020 the European Council amended Directive 2011/16/EU, in order to defer certain deadlines for filing and exchanging information under the Directive on Administrative Cooperation (“DAC”). The postponement is justified by the difficulties Member States and businesses are facing with during the pandemic.
Based on the Commission’s proposal, the Council has decided to give three extra months to the Member States to exchange information on the financial accounts of beneficiaries who are tax residents in another Member State. Similarly, Member States have six additional months to exchange information on certain cross-border tax planning arrangements. The Commission has also proposed to preserve the possibility of the extension of the deferral period. The above mentioned amendments only affect the deadlines applicable for reporting obligations.
The Council and Commission acted due to the Coronavirus crisis that caused extra burden on Member States. Nevertheless, the Council and Commission are still committed in the fight against the tax evasion and avoidance.
By Gabriella Galik, Partner, KCG Partners Law Firm