"DAC 6” stands for the EU Directive on Administrative Cooperation in (direct) taxation and iintroduces reporting obligations for a wide range of cross-border tax arrangements.

A scheme is considered cross-border if it involves more than one EU Member State, or one EU Member State and another (non-EU) State, and meets any of the following criteria:

• not all participants in the scheme are tax residents of the same jurisdiction;

• at least one of the participants in the scheme operates in another jurisdiction through a permanent establishment, and the scheme is part of the activities of this permanent establishment;

• at least one of the participants in the scheme operates in another jurisdiction without being its tax resident and without establishing a permanent establishment in this jurisdiction;

• at least one of the participants in the scheme is simultaneously a tax resident of more than one jurisdiction;

• the scheme could potentially affect the automatic exchange of information or the determination of beneficial owners.

The reporting obligation falls on both taxpayers themselves and intermediaries (such as corporate service providers, lawyers, accountants, financial advisors, banks, etc.).

The intermediary is, in general, any natural or legal person who develops, promotes, organizes, ensures the implementation or manages the implementation of a cross-border scheme that is subject to declaration.

To be recognized as an intermediary, a person must meet at least one of the following conditions:

• be a tax resident of an EU state;

• have a permanent establishment in a Member State through which the services related to the scheme are provided;

• be registered in an EU State or subject to the laws of a Member State;

• be a member of a professional association in the field of legal, tax or advisory services in an EU country.

Many countries have already brought their national laws in line with the Directive.

IMPORTANT! The administrative fines for non-compliance are set at a maximum of EUR20,000 for each failure to report.

99 classical offshore, onshore and midshore jurisdictions of Europe, America, Middle East, Asia, Africa and Oceania‍