Bill n° 7465 implementing Council Directive (EU) 2018/822 of 25 May 2018 amending Directive 2011/16/EU as regards mandatory automatic exchange of information in the field of taxation in relation to reportable cross -border arrangements (the Bill) - commonly referred to as DAC6 - has been deposited in front of the Luxembourg Parliament on 8 August 2019.
The Bill introduces new reporting obligations applicable to EU intermediaries (including banks, accounting firms, law firms, corporate service providers and certain other persons) involved in cross -border and potentially aggressive tax arrangements subject to certain conditions (“hallmarks”). In the absence of intermediaries required to make a filing (e.g. where the intermediary is a non-EU intermediary or can claim legal professional privilege), the taxpayer will need to disclose itself the arrangement to the tax authorities. The Bill specifies that the legal professional privilege applies to Luxembourg lawyers. As a consequence, Luxembourg lawyers must inform the other EU intermediaries (if any) or otherwise the taxpayer regarding their disclosure obligations.
Under the Bill, non-compliance may result in penalties imposed by the tax authorities up to EUR 250,000.
DAC6 must be implemented before year-end and applies from 1 July 2020. However, information regarding reportable cross-border arrangements where the first step was implemented between DAC6’s date of entry into force (i.e. 25 June 2018) and DAC6’s application date (i.e. 1 July 2020) must be reported by 31 August 2020 at the latest.