Duty to report cross-border tax planning arrangements from 1 July 2020

Project Description

The Directive on reporting cross-border arrangements (“Mandatory Disclosure Directive”) is being implemented in the Netherlands through a legislative proposal. The purpose of the Directive and the bill is to promote tax transparency and stems from the so-called BEPS initiatives of the OECD to combat tax base erosion and “artificially” transferring profits to low-tax jurisdictions. The bill contains an obligation to report potentially aggressive cross-border tax planning arrangements to the tax authorities.

From 1 July 2020, the notification requirement will arise, but this will have a retroactive effect for custom-made constructions of which the first step in implementation took place after 25 June 2018. In principle, the notification obligation rests with the intermediary (such as tax advisers, accountants, and financial institutions).

In other European countries, the Directive is also being implemented with broadly comparable requirements, although there are considerable differences in terms of scope and dates of implementation.

For the Netherlands, see among others: https://www.rijksoverheid.nl/actueel/nieuws/2019/07/12/wetsvoorstel-ingediend-dat-intermediairs-verplicht-stelt-grensoverschrijdende-constructies-te-melden