On 22 October 2019, the government of Austria officially published the EU-Mandatory Disclosure Act implementing the European Union (EU) Directive on the mandatory disclosure and exchange of cross-border tax arrangements (DAC6). Under DAC6, taxpayers and intermediaries are required to report cross-border reportable arrangements from 1 July 2020.
The possibility of taxation covered by Austrian legislation is fully in line with the Directive and applies to income and corporate tax but not to VAT, customs duties, excise duties and compulsory social security contributions.
Under DAC6, cross-border arrangements are defined as arrangements concerning more than one Member State or a Member State and a third country. The hallmarks can be distinguished as hallmarks which are subject to the main benefit test (MBT), and those which by themselves trigger a reporting obligation without being subject to the MBT.
Under the Directive, reporting starts from 1 July 2020 and exchanges between jurisdictions by 31 October 2020. However, reports will retroactively cover arrangements where the first step is implemented between 25 June 2018 and 30 June 2020. The Austrian reporting deadlines are fully in line with the DAC6 timeframes.
Penalties are also applicable under the Austrian Fiscal Criminal Act of up to €50,000 in the case of deliberate intent and up to €25,000 in the case of gross negligence and per violation. There is no possibility to avoid this penalty by filing a voluntary self-disclosure.
