Insights

Changes to DAC6 and OECD Mandatory Tax Reporting

The International Tax Enforcement (Disclosable Arrangements) Regulations 2020 (DAC6) and OECD Mandatory Tax Reporting

The International Tax Enforcement (Disclosable Arrangements) Regulations 2020, which came into effect on 1 July 2020, implemented the EU’s DAC6 disclosure requirements. Since then, many groups have gone back to 25 June 2018 to identify their reportable cross border arrangements under the five Hallmarks.

However, as part of the changes brought about by Brexit, significant sections of the regulations have been repealed.

The only disclosure that will now be required in the UK under the Hallmarks is:
Category D – Hallmarks concerning automatic exchange of information and beneficial ownership (which must be interpreted in accordance with the Model Mandatory Disclosure Rules for CRS Avoidance Arrangements and Opaque Offshore Structures approved by the OECD on 8 March 2018). 

There is no change to the reporting deadlines and the first report is due by 30 January 2021.  HMRC has indicated that its portal for reportable cross-border arrangements will be available from mid-January. No other disclosure is required.

During 2021, the remainder of the regulations will be repealed and that is the end of the good news – because following a period of consultation, new legislation implementing the OECD’s Mandatory Disclosure Rules (MDR) will be introduced.