Starting with July 1, 2020, the provisions of the EU Directive 2018/822 on mandatory automatic exchange of information in the field of taxation regarding the reportable cross-border arrangements (DAC6) enter into force and have been transposed into the national legislation by the Government Ordinance no. 5/2020 for the amendment and completion of the Fiscal Procedure Code.
The directive was issued against the erosion of the national tax bases of EU member states, as tax planning structures have evolved into very sophisticated ones and often take advantage of the increased mobility of both capital and people in the internal market.
These structures usually consist of arrangements that are developed at the level of several jurisdictions and allow the transfer of taxable profits to more favorable tax regimes or have the effect of reducing the overall amount of taxes to be paid by the taxpayer.
In the above context, the obligation to report such cross-border arrangements by intermediaries or relevant taxpayers has been established.
The intermediary is any person who designs, sells, organizes, makes available for implementation or manages the implementation of a cross-border arrangement that is the subject of reporting. To be an intermediary, a person must meet certain additional conditions.
Within the project there is a definition of intermediaries, in this category being found, but not limited to them, professionals from different fields – tax consultants, lawyers, accounting experts, financial consultants, as well as entities with or without legal personality (for example, financial institutions, etc.).
The relevant taxpayer is any person who is provided with a cross-border arrangement that is the subject of reporting for implementation or who is prepared to implement a cross-border arrangement that is the subject of reporting or who has implemented the first stage of such an arrangement.
The relevant intermediaries or taxpayers have the obligation to report by August 31, 2020 the cross-border arrangements for the period between June 25, 2018 and July 1, 2020.
The reporting period for intermediaries and relevant taxpayers is 30 days from the date on which they became aware of a cross-border arrangement.
Also, the normative act establishes several sanctions for violating the reporting obligations in order to increase the degree of voluntary compliance of both taxpayers and intermediaries. Failure to comply with the reporting obligations is sanctioned with a fine from RON 20,000 to RON 100,000 for non-reporting or delayed reporting of cross-border arrangements that are the subject of reporting.