The European Commission proposes postponement of filing deadlines, including for EU Mandatory disclosure rules (DAC6)

The European Commission postpones filing deadlines

The European Commission (EC) issued a press release on 8 May 2020 announcing proposals to postpone the entry into force of certain EU taxation measures in response to the difficulties that businesses and EU Member States are facing due to the coronavirus (COVID-19) pandemic.

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Rene Schob

Partner, Head of Tax & Legal

KPMG in Romania

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The measures postponed

As noted in the EC’s press release (8 May 2020), the EC is proposing to defer by three months certain deadlines for filing and exchanging information under the Directive on Administrative Cooperation (Council Directive 2011/16/EU, also known as “DAC”). The initiative comes in the form of a Directive amending the DAC and proposes the following:

  • As regards the EU mandatory disclosure rules (MDRs) introduced by Council Directive 2018/822/EU (DAC6), implemented in Romania by Government Ordinance no.5/2020:
    • Changing the date for the beginning of the 30-day period for reporting cross-border arrangements from 1 July 2020 to 1 October 2020.
    • Changing the date for the reporting of cross-border arrangements that became reportable from 25 June 2018 to 30 June 2020, from 31 August 2020 to 30 November 2020.
    • Changing the date for the first exchange of information on reportable cross-border arrangements from 31 October 2020 to 31 January 2021.
  • As regards the EU common reporting standard (CRS) for reporting financial institutions, transposed into EU law via Council Directive 2014/107 (DAC2), a deferral of the time limit for exchanges of information on “reportable financial accounts” by three months, i.e. until 31 December 2020.

The EC also proposes a possibility to further extend the deferral period once, for a maximum of three additional months. It is proposed that this option would only be invoked if during the initial period of deferral, the exceptional circumstances of severe risks for public health caused by the COVID-19 pandemic persist and the EU Member States are forced to implement lockdown measures.

The EC also proposes a delay of the entry into application of the value added tax (VAT) e-commerce package by six months— i.e. the rules would apply as from 1 July 2021 instead of 1 January 2021.

Unanimous agreement among EU Member States is required in order for the EC’s proposal to be adopted and enter into force. EU Member State representatives are expected to discuss the proposal on Monday 11 May 2020.

KPMG comment:

No official communication on the deferral of these measures has been issued by the Romanian tax authorities yet, but we expect unanimous agreement by EU Member States, given the discussions that have taken place so far about the possibility of postponing these deadlines in the context of COVID-19.
 

© 2021 KPMG Tax SRL, a Romanian limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

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