EU Mandatory Disclosure Rules

The EU Directive on Mandatory Disclosure Rules "Directive" entered into force on 25 June 2018, making it obligatory for intermediaries and taxpayers, as the case may be, to file information with respect to cross-border arrangements which exhibit features of aggressive tax planning.

The Directive will apply to all arrangements the first step of which was implemented on or after 25 June 2018. While the scheme of the Directive is to cast the initial obligation to report on the intermediaries, there are possible exceptions and exemptions that may apply. Where an intermediary is exempt from filing, the reporting obligation will lie with the taxpayer. In terms of its geographical extent, the Directive applies whenever, in the context of an arrangement, there is an EU connection, which may come from the arrangement itself, the taxpayer or the intermediary.

At the moment, there is a lot of uncertainty with respect to the application/interpretation of the Directive. We have therefore prepared a step-by-step guide with a high level commentary on each step to help readers identify the various steps they may need to follow to determine the applicability of the Directive and to engage in follow-up action.