On Monday 28 October, the European Commission published the ninth version of the Directive on Administrative Cooperation in the field of taxation (DAC9’).
This text transposes the OECD Information Return into Community law. The Information Return contains data to enable tax administrators to assess a multinational company’s compliance with Global Anti-Base Erosion Rules (‘GloBE Information Return’ or GIR). This provision is set out in Article 44 of the Directive on international tax reform on the minimum tax on companies (Pillar II), which came into force in January 2024 (see EUROPE 13320/17).
This proposal establishes a framework to facilitate the exchange of top-up tax information returns between Member States and to allow multinational enterprises to switch from local to central filing made by the ultimate parent entity of the multinational enterprise or by a designated filing entity, instead of filing by each constituent entity. The main change is the new Article 8A, which sets out the framework for the exchange of Top-up tax information returns.
Partial application of ‘DAC9’. The text also introduces the obligation for Member States to take the necessary measures to enable the reporting entities of a multinational enterprise that is resident for tax purposes within the EU to file the top-up tax information return within 15 months after the last day of the reporting fiscal year. Once this declaration has been lodged with the Member State, its competent authority sends the appropriate parts of this return to the competent authorities of the other relevant Member States.
For the first year of application of the ‘Pillar II’ directive, i.e. the 2024 tax year, the deadline for exchanging the information is six months after the filing deadline. Top-up tax information returns received after the filing deadline should also be exchanged as soon as they are received and, in any event, no later than three months after they are received. The communication of information to competent authorities of other Member States will take place using the standard computerised form that will be developed by the European Commission by means of a delegated act.
For Member States that have elected not to apply the ‘Income Inclusion Rule’ (IIR) and the ‘Undertaxed Profits Rule’ (UTPR) (see EUROPE 13283/25), the application of ‘DAC 9’ is also postponed.
In addition, the new Article 9a provides for the possibility for the competent authority to enquire about a top-up tax information return that was notified to be filed centrally but which has not been exchanged. The competent authority of a Member State where the filing entity is resident may then check whether such a report has been filed and enquire about the expected filing date, if this has not yet been done.
If the top-up tax information return has not been received within three months of the new expected filing date, local filing obligations may be imposed on the MNE’s constituent entities in order to obtain the top-up tax information return. However, no local filing obligation may be imposed on the constituent entities before the expiry of this three-month period.
Finally, the European Commission's proposal adds an annex (Annex VII) to the ‘DAC’, which includes the filing rules applicable to the filing entity of the multinational enterprise and describes the top-up tax information declaration.
Read the proposal: https://aeur.eu/f/e24 (Original version in French by Anne Damiani)