Revenue announces a deferral by 6 months of the first reporting deadlines of cross-border arrangements under the Mandatory Disclosure Rules (DAC 6).
On 2 July the Maltese Revenue announced that the Commissioner for Revenue will be deferring by six months the first reporting deadlines under regulation 13 of the Cooperation with Other Jurisdiction on Tax Matters Regulations, SL 123.127. Such Regulations transpose, amongst others, Directive (EU) 2011/16/EU as amended by Directive (EU) 2018/822 on mandatory disclosure rules (‘MDR’ or ‘DAC 6’) which imposes mandatory exchange of information obligations on intermediaries and taxpayers. Such deferral follows the European Council’s agreement on the postponement of such deadlines and the publication of Directive (EU) 2020/876.
The Commissioner for Revenue notified that an amending legal notice will be issued to this effect within the coming weeks. This will provide taxpayers and intermediaries dealing with the impacts of the COVID-19 pandemic with additional time to ensure that they can comply with their obligations under the said Regulations.
Considering this deferral, reporting systems in relation to reportable cross-border arrangements will be made available to taxpayers and intermediaries ahead of the new deferred deadlines. The Commissioner for Revenue announced that it intends to publish guidance within the coming months to help businesses in their preparations to meet their reporting obligations.
The MDR/DAC 6 requires the reporting to the tax authorities of cross-border arrangements that satisfy particular hallmarks. Taxes of any kind are within the scope of MDR/DAC6 with the exception of VAT, customs duties, excise duties and social contributions. The Revenue’s announcement affects only the provisions related to the reporting and filing of the information and does not relate to any other provision of the MDR/DAC6 that is now applicable (as of 1 July 2020).
The deferral has the effect of postponing the reporting deadlines as follows:
Failure to report on a timely basis will incur penalties that are capped at EUR 20,000.
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