As we draw closer to 1 January 2021, when DAC6 reporting requirements begin across all EU member states, many tax authorities are beginning to make the final preparations for DAC6. VinciWorks is in close contact with tax authorities across the EU. Here is the latest update from HMRC:
Reporting Site: HMRC will be carrying out private Beta testing of its DAC6 reporting site with the hope of opening it up to the public at the end of December. Obviously, the bank holidays around Christmas and New Year will make this challenging as support staff need to be available to help with any difficulties.
Mandatory Reporting Fields: There are some mandatory fields that require reporting in accordance with the UK’s XML Schema that might be problematic to answer as the information is not available at the time of reporting. HMRC is investigating what those fields are in order to provide guidance.
We discussed with HMRC that the following fields might be unknown at the time of reporting, where relevant you can see HMRC’s suggested approach:
- Open text answers – If the answer is not known at the time of reporting “Unknown” should be written.
- Country of Tax Residence – This is a mandatory field that cannot be left blank. If there is no country of tax residence as the entity is tax transparent, HMRC would expect the country where the entity is incorporated or established to be answered here.
- Associated Enterprises – Only those associated enterprises of a taxpayer that are affected should be listed here (it would seem this was an oversight in the central EU schema).
- Implementing Date – If the implementing date is not known (e.g. because an earlier trigger such as the arrangement being made available has been met), then the date which should be entered is the date the reporting trigger was met.
Other fields that are awaiting clarification from HMRC include the “Value” field, which jurisdictions such as Luxembourg have instructed should be answered as “1” when unknown, and “date” fields, which other jurisdictions have stipulated should be written as “01/01/1900” if they are unknown.
The pressure is now on for tax authorities to finalise their reporting schemas and mechanisms. As always, VinciWorks will keep its clients up to date with all the latest guidance from HMRC and tax authorities across the EU.
VinciWorks’ DAC6 reporting solution
Our DAC6 reporting tool provides law firms and multinational businesses with the expertise, knowledge and technical infrastructure to comply with the EU Directive in every EU jurisdiction. The tool uses a built-in knowledge engine to guide users through the DAC6 process and recommends which transactions should be reported. It features workflows designed and updated for the intricacies of each EU member state’s implementation of DAC6. Countries with stricter reporting guidelines are flagged.
