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EU DAC 7 marketplaces’ transaction reporting – half states miss Jan 2023 implementation

EU member states adopting  harmonised tax data requests for marketplaces; efficient exchange of data between tax authorities – first reports due 2024 for transactions in 2023

Adoption of Directive on Administration Cooperation (DAC 7) is underway across the EU states.

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The latest DAC7 implementation statuses for the 27 EU member states:

  • Austria approved in July
  • Belgium gazetted Dec 2022
  • Bulgaria Dec 2022 law issued
  • Croatia gazettes legislation Dec 2022
  • Cyprus OUTSTANDING no draft legislation yet
  • Czech gazetted Dec 2022
  • Denmark implemented new rules Sep 2022
  • Estonia OUTSTANDING govt approves draft bill Oct 2022
  • Finland draft in Parliament Oct 2022
  • France gazetted Dec 2022
  • Germany gazetted Dec 2022
  • Greece OUTSTANDING no draft legislation yet
  • Hungary gazetted Nov 2022
  • Ireland (2021 Finance Bill) accepted
  • Italy gazetted Dec 2022
  • Latvia gazetted Jan 2023
  • Lithuania gazetted Dec 2022
  • Luxembourg Outstanding Bill presented to Parliament Jun 2022
  • Malta Outstanding no draft legislation yet
  • The Netherlands adopted Dec 2022
  • Romania OUTSTANDING transposed into Romanian Fiscal Procedure Code
  • Poland OUTSTANDING draft legislation published Nov 2022
  • Portugal OUTSTANDING no draft legislation yet
  • Romania OUTSTANDING no draft legislation yet
  • Slovakia Bill adopted into legislation July 2022
  • Slovenia law passed Dec 2022
  • Spain OUTSTANDING, Council of Ministers approved Bill Dec 2022
  • Sweden OUTSTANDING parliament implement bill Nov 2022

The EU is also reviewing a full VAT liability for digital platforms as part of its VAT in the Digital Age reforms.

DAC 7 was approved by the EU Council in March 2021. The new digital platform seller rules will come into effect on 1 January 2023 (first report by 31 Jan 2024). This provides for a standard data format for requests by EU tax authorities from digital marketplaces on their third-party sellers’ VAT transactions. This includes the automatic exchange of this information (AEOI) between tax authorities. Non-compliance with these new reporting obligations will lead to substantial penalties.

DAC 7 covers all transactions for: goods; services; plus gig and sharing economies. And all transaction types – B2C, B2B. B2G, P2P etc.

The Organisation for Economic Cooperation and Development (OECD) has followed this plan to issue OECD optional marketplace reporting guidance for countries. The UK marketplace reporting requirements were recently delayed to 2024.

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Aims of the DAC 7 administrative agreement include:

  • Identifying online merchants not properly declaring and paying VAT
  • Providing for a consistent and efficient set of requirements for marketplaces to avoid them having not manage different requests and duplicate questions
  • Legal ability for tax authorities to work together on joint audits on seller activities from 1 January 2024

Follow all the European Union’s completed and planned reforms via VAT Calc’s EU VAT reform tracker.

DAC aid exchange of VAT data for application of EU VAT Directive

DAC is a set of EU-level legal rules which provide for guidance on the electronic exchange of any data in the furtherance of compliance with domestic laws. It represents an amendment to the EU VAT Directive – the seventh since the 2011 Directive 2011/16/EU.

DAC 7 obliges marketplaces to provide data on their third-party sellers’ transactions, covering

  • Sales of goods
  • Provision of personal services
  • Rentals of property, including house sharing
  • Rental and sharing of transport

The information on the above supplies to be provided includes:

  • Name and address of merchant
  • VAT number
  • Tax identification number
  • Taxable supplies and income in calendar year
  • Bank account details

Started 2023; first report due 31 January 2024

The new DAC7 tax rules apply to digital platforms operating both inside and outside the EU since 1 January 2023. Annual reports are required by the end of the first month following the reporting year. The first DAC 7 report is therefore due by 31 January 2024.

You can check the right VAT calculations on individual or batch transactions with our Advisor and Auditor services.

 

EU VAT reforms

Reform (click for details) Update
Contact VATCalc to learn how our single VAT determination, reporting and e-invoicing platform can help you manage and thrive with global compliance change
2028 Digital Reporting Requirements and e-invoicing harmonisation Published Dec 2022
Structured e-invoices supercede paper invoices Published Dec 2022
EC Sales lists replaced by Digital Reporting Requirements Published Dec 2022
2025 Single VAT Registration in the EU - extension of OSS Published Dec 2022
Marketplace deemed supplier extended to EU sellers Published Dec 2022
Proposal for VAT treatment of the platform economy Published Dec 2022
EU IOSS mandated for marketplaces Published Dec 2022
Call-off stock VAT simplification ends Published Dec 2022
Harmonisation of B2B Reverse Charge rules Published Dec 2022
VAT registration thresholds equivalence foreign businesses On track
Virtual events VAT rule changes Agreed
2024 Payment providers' seller transaction reporting and bookkeeping obligations On track
EU permissions on e-invoicing removed Published Dec 2022
2023 DAC 7 - marketplace reporting harmonisation On track
Financial Services VAT exemption reform proposals Consultation complete; proposal 2023
Tour operator margin scheme VAT reforms EC undertaking fresh review
2022 IOSS reforms to prevent double taxation Proposals early 2022
EU reduced VAT rate freedoms Enter into force 6 April 2022
VAT in the Digital Age proposals Published Dec 2022
EU DAC8 cryptocurrency tax reporting proposals Published Dec 2022
VAT Gap Initiative Q3 2022
EU Definitive VAT System On hold
2021 One-Stop-Shop (OSS) single EU VAT return In effect since 1 July 2021
Ending €22 import VAT exemption; new IOSS return In effect since 1 July 2021
Marketplace deemed supplier EU VAT reforms In effect since 1 July 2021
2020 EU four Quick Fixes for VAT In effect
Tax authorities anti-VAT fraud cooperation In effect
Tax Action Plan - 25 VAT and other tax reforms roadmap See 'VAT in the Digital Age' and others
2019 Simplification of e-services VAT compliance and thresholds In effect
Single and multi-use vouchers In effect
2018 Lower e-book and publications VAT rates In effect, although not all EU states have adopted the option
EU Generalised Domestic Reverse Charge VAT Mechanism In effect, although no country has adopted this voluntary option
2015 B2C electronic services VAT reforms - MOSS return In effect
Contact VATCalc to learn how our single VAT determination, reporting and e-invoicing platform can help you manage and thrive with global compliance change

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