Category Archives: Tax Evasion

VinciWorks hosts fourth DAC6 Core Group Meeting – Summary

On Wednesday, 9 September, 2020, around 200 people joined VinciWorks for its fourth DAC6 Core Group meeting. This was a continuation of our third core group meeting held at Freshfields Bruckhaus Deringer’s London office earlier in 2020. In light of COVID-19, this fourth meeting was held virtually; however, audience participation was encouraged and this was not “just another webinar”.

VinciWorks have close relationships with various tax authorities across the EU, and we were joined at our meeting by James Marshall from HMRC, and Valérie Robbertz and Willem-Jan van Veen from the Netherlands Tax and Customs Administration (NTCA).

Below is an overview of some of the key questions that were discussed in the meeting.

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VinciWorks’ DAC6 reporting solution announced as a finalist for the British Legal Technology Awards

On Wednesday 9 September, as we were wrapping up a successful fourth DAC6 Core Group Meeting via Zoom, we were announced as one of the four finalists for this year’s British Legal Technology Awards. This year, our DAC6 reporting solution was nominated in the category of IT Product or Service of the Year. The announcement follows hard work from our full-time DAC6 team consisting of developers, subject-matter experts, support technicians and designers.

This is the third award VinciWorks has been nominated for in 2020 after our mental health training was nominated for the EG Tech Awards and the InsideOut Awards.

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VinciWorks to release new tax evasion refresher course

Screenshot of tax evasion game in Criminal Finances Act course
The new tax evasion refresher course includes a game whereby users are presented with realistic scenarios

VinciWorks will soon be releasing a new tax evasion refresher course. The course takes a modern, fresh approach to tax evasion training with a focus on industry-specific guidance, role-relevant scenarios and an interactive, engaging approach to ensuring all staff have the skills and understanding they need to prevent facilitation of tax evasion.

The Criminal Finances Act created a corporate criminal offence for failing to prevent the facilitation of tax evasion. This places the responsibility on businesses to have “reasonable procedures” in place to ensure none of their employees or contractors are involved in helping someone evade their taxes anywhere in the world. Guidance from HMRC advises that reasonable procedures should be guided by the following 6 principles:

  • Risk assessment
  • Proportionality of risk-based prevention procedures
  • Top-level commitment
  • Due diligence
  • Communication and training
  • Monitoring and review
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Germany’s decision not to postpone DAC6 reporting – are you affected?

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Intermediaries located across Europe breathed a great sigh of relief last month when most EU member states announced they will be postponing their reporting deadlines for DAC6 by 6 months due to COVID-19. This means that DAC6 reporting will be pushed off until 2021.

However, some member states, including Germany, have decided not to adopt the optional deferral and to continue with the original DAC6 timeline. If you are an intermediary that has a legal presence in Germany and were planning on waiting until 2021 to report your historical arrangements in a different EU Member State, think again.

How will Germany’s decision affect intermediaries?

VinciWorks has been in regular contact with member state tax authorities. The German Federal Ministry of Finance (Bzst) has made it very clear that if you or your firm have a German legal presence and have been involved in a reportable DAC6 arrangement since June 2018, then you are required to make any DAC6 reports in Germany without delay.

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Upcoming Event – Fourth DAC6 Core Group Meeting

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Wednesday 9 September, 12:00–15:00 (BST)

DAC6 is a European directive aimed at reducing international tax evasion and promoting transparency. It requires lawyers, accountants, tax advisers, bankers and other “intermediaries” to report some aggressive cross-border tax arrangements. Multinational businesses might also be required to report transactions in circumstances where no external intermediary is able to report. These “mandatory disclosure requirements” (MDR) are for tax transactions that cross EU borders, where it seems that the primary purpose of the transaction is a tax advantage.

Over the last 18 months, VinciWorks has brought together over 100 international law and accounting firms to help firms grapple with the Directive and develop best-practice for DAC6.

We are now hosting our fourth DAC6 Core Group meeting on Wednesday, 9 September 2020, 12:00–15:00 (BST) via Zoom.

The agenda includes an open Q&A session with James Marshall, HMRC’s DAC6 policy lead, and an international panel including Willem-Jan van Veen and Valérie Robbertz from the Netherlands Tax and Customs Administration.

The virtual meeting will also include case studies from firms that have already implemented a DAC6 reporting system, and an update on reporting across EU member states.

Free registration

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DAC6 Country Profile: Latvia

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Latvian Parliament
In light of the COVID-19 pandemic, Latvia has chosen to delay DAC6 reporting by six months

Each EU Member State had until 31 December 2019 to transpose DAC6 into local laws and legislation. A letter of formal notice was issued by the EU Commission to 15 EU Member States detailing the infringements of DAC6 application into local law.

We are publishing a series of guides on how each EU member state is implementing DAC6. These guides will cover each country’s decision regarding postponing DAC6 reporting by up to six months. The guide provides a preview to our full up-to-date country-by-country guide to DAC6.

Our next guide focusses on Latvia’s implementation of DAC6.

Has Latvia implemented DAC6?

Legislation Details

Latvia’s tax authority, Valsts ienemumu dienests (State revenue service of the Republic of Latvia), published DAC6 legislation, called Rules on the automatic exchange of information on reportable cross-border arrangements / 14.04.2020 and Amendments to the Law on Taxes and Fees on 14 April 2020.

Taxes covered

Latvia’s legislation covers cross-border arrangements. The legislation is in line with the EU Directive and does not include domestic arrangements or any additional hallmarks.

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Mexico to implement their own version of DAC6

Flag of Mexico
In Mexico, intermediaries will be required to report cross-border transactions from January 2021

Mexico is set to implement a new mandatory disclosure regime (MDR) aimed at reducing international tax evasion. The Mexican law is modelled after DAC6, a European directive that requires lawyers, accountants, tax advisers, bankers and other “intermediaries” to report some aggressive cross-border tax arrangements. It is part of a broader OECD initiative to combat tax evasion, known as BEPS Action 12.

Mexico’s mandatory disclosure law will be in force from January 2021, with a requirement to report some historic data. 

For Mexico, this means that businesses will need to enforce transactions that go as far back as January 2020. Businesses who start keeping track of transactions now will find it easier to report transactions when the mandatory disclosure law is in force in Mexico.

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DAC6 Country Profile: Spain

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Spanish Parliament
In light of the COVID-19 pandemic, Spain has chosen to delay DAC6 reporting by six months

Each EU Member State had until 31 December 2019 to transpose DAC6 into local laws and legislation. A letter of formal notice was issued by the EU Commission to 15 EU Member States detailing the infringements of DAC6 application into local law.

We are publishing a series of guides on how each EU member state is implementing DAC6. These guides will cover each country’s decision regarding postponing DAC6 reporting by up to six months. The guide provides a preview to our full up-to-date country-by-country guide to DAC6.

Our next guide focusses on Spain’s implementation of DAC6.

Has Spain implemented DAC6?

Legislation Details

Spain’s tax authority, Agencia Tributaria (Tax Agency), published DAC6 legislation, called Proyecto de Ley por la que se modifica la Ley 58/2003, de 17 de diciembre, General Tributaria, en transposición de la Directiva (UE) 2018/822 del Consejo, de 25 de mayo de 2018, que modifica la Directiva 2011/16/UE por lo que se refiere al intercambio automático y obligatorio de información en el ámbito de la fiscalidad en relación con los mecanismos transfronterizos sujetos a comunicación de información (La trasposición se residencia en la Ley 58/2003, de 17 de diciembre, General Tributaria).

Taxes covered

Spain’s legislation covers cross-border arrangements. The legislation is in line with the EU Directive and does not include domestic arrangements or any additional hallmarks.

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On-demand webinar: DAC6 reporting solution – Feature updates

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Wednesday, 29 July, 12pm UK time

In March, we hosted a live demo of our reporting solution where we covered the core features of our DAC6 reporting software. Since then, the system has evolved to help businesses solve all the challenges presented by the complex Directive. Even if you have seen a demo of the product in the past, now is the time to get up-to-date with the implementation process.

Here are just some of the updates we have made:

  • Enhanced workflow with country-by-country guidance
  • Ability to report in multiple jurisdictions
  • New graphical customisable dashboards

In this webinar, we covered the core features of our software, new features that have recently been added and give guidance on how businesses can use it to report transactions. This webinar is suitable for both those who have attended previous demos and those who are less familiar with our system.

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DAC6 Country Profile: Sweden

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Riksdag - Swedish Parliament
In light of the COVID-19 pandemic, Sweden has chosen to delay DAC6 reporting by six months

Each EU Member State had until 31 December 2019 to transpose DAC6 into local laws and legislation. A letter of formal notice was issued by the EU Commission to 15 EU Member States detailing the infringements of DAC6 application into local law.

We are publishing a series of guides on how each EU member state is implementing DAC6. These guides will cover each country’s decision regarding postponing DAC6 reporting by up to six months. The guide provides a preview to our full up-to-date country-by-country guide to DAC6.

Our next guide focusses on Sweden’s implementation of DAC6.

Has Sweden implemented DAC6?

Legislation Details

Sweden’s tax authority, the Swedish Tax Agency (Skatteverket), published the second DAC6 draft bill on 4 February 2020. The legislation is called Lag (2020:434) om rapporteringspliktiga arrangemang – Act (2020:434) on reporting arrangements.

Taxes covered

Swedish legislation covers cross-border arrangements. The legislation is in line with the EU Directive and does not include domestic arrangements or any additional hallmarks.

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