What Is EU Mandatory Disclosure (DAC6)?
EU Mandatory Disclosure refers to a European Union reporting obligation under which intermediaries or taxpayers report potentially aggressive cross-border tax arrangements to national tax authorities.
Also known as: DAC6, Mandatory Disclosure Rules.
How EU Mandatory Disclosure works
EU Mandatory Disclosure, introduced by Council Directive (EU) 2018/822 and known as DAC6, applies when a cross-border arrangement concerning more than one Member State, or a Member State and a third country, displays at least one hallmark listed in Annex IV, some of which count only when a tax advantage is a main benefit. Intermediaries such as advisers and banks generally file within 30 days, counted from the earliest of the arrangement being made available for implementation, being ready for implementation or having its first step implemented. The duty passes to the relevant taxpayer where no intermediary reports, including where privileged advisers leave no other intermediary. National rules apply from 1 July 2020, penalties and transposition details vary by Member State, and a tax authority's silence does not imply acceptance of the arrangement.
EU Mandatory Disclosure vs Common Reporting Standard (CRS)
Unlike the Common Reporting Standard, which covers account balances and income reported by financial institutions, EU Mandatory Disclosure targets the design of cross-border arrangements and is triggered by hallmarks rather than by holding an account.
Example
Illustrative example: An adviser in Country A, an EU Member State, designs a structure for an entrepreneur under which consulting income is routed through a new company in a third country. If the structure displays an Annex IV hallmark, the adviser generally reports it; where privilege applies and no other intermediary exists, the entrepreneur may hold the reporting duty under local transposition rules.
Common misconception
Myth: Only advisers face DAC6 reporting, so clients carry no exposure.
Reality: Where no intermediary reports, the duty can fall on the relevant taxpayer, and Member States set penalties for non-compliance.
Frequently asked questions
What is DAC6 reporting?
DAC6 reporting is the EU Mandatory Disclosure regime under Council Directive (EU) 2018/822, which requires intermediaries or relevant taxpayers to report cross-border arrangements displaying Annex IV hallmarks to the competent tax authority.
Does DAC6 apply to individuals?
DAC6 can apply to individuals as relevant taxpayers where no intermediary files, for example where the only adviser invokes legal professional privilege; reportability depends on the hallmarks and on national transposition.
Related terms
- Common Reporting Standard (CRS) — Often confused: account reporting, not arrangement reporting
- Directive on Administrative Cooperation — DAC6 amends the EU administrative cooperation directive
- Automatic Exchange of Information (AEOI) — DAC6 reports are exchanged automatically between Member States
- EU Anti-Tax Avoidance Directive (ATAD) — Parallel EU anti-avoidance instrument
- Main Purpose Test — Similar purpose-based test to the main benefit test
Related guides
- Tax management approaches: from compliance to aggressive strategies — Context on where planning becomes reportable
- Digital nomad tax setups guide — Cross-border setups that may involve reporting
Sources
Last verified: 2026-10-08. This entry is general information, not tax or legal advice; rules vary by country and change over time.
