Tag: DAC

The Directive 2011/16/EU (DAC) has been amended five times through the following amending Directives, most of which have broadened the scope of AEOI originally circumscribed to 5 categories of income and capital (income from employment, directors fees, life insurance products, pensions, ownership of and income from immovable property)
• 2014/107/EU (hereinafter “DAC2”) on automatic exchange of financial accounts information;
• 2015/2376/EU (hereinafter “DAC3”) on automatic exchange of advance cross-border tax rulings (ATR) and advance pricing agreements (APA);
• 2016/881/EU (hereinafter “DAC4”) on automatic exchange of CbC reports;
• 2016/2258/EU (hereinafter “DAC5”) as regards access to AML information by tax authorities;
• 2018/822/EU (hereinafter “DAC6”) on automatic exchange of information in relation to reportable cross-border arrangements.

EU Transparency on Income Allocation and Tax Arrangements – DAC 1 to 6

May 25, 2018 / Advance cross border rulings, Automatic exchange of information, Country-by-Country Reporting, DAC, EU, Exchange of information, Information on tax planning arrangements, Tax Avoidance Schemes, Tax Havens and Harmful Tax Practices, Transfer Pricing Guidelines, Transfer Pricing News

Tax authorities in the EU have agreed to cooperate more closely and exchange information so as to be able to apply their taxes correctly and combat tax fraud and tax evasion. Exchange of Information within the EU is based on Council Directive 2011/16/EU. The Directive and the later amendments in DAC 2 – 6 provides for exchange of information in three forms: spontaneous, automatic and on request. Spontaneous exchange of information takes place if a country discovers information on possible tax evasion relevant to another country, which is either the country of the income source or the country of residence. Exchange of information on request is used when additional information for tax purposes is needed from another country. Automatic exchange of information (AEOI) is activated in a cross-border situation, where a taxpayer is active in another country than the country of residence. In such cases tax administrations provide automatically tax information to the residence country of the taxpayer, in electronic form on a periodic basis ... Continue to full case

In these two cases from Israel the Supreme Court rules on the issue of whether or not companies using the cost plus method must include stock-based compensation in the cost base. The Court concludes that stock-based compensation is an integral part of the compensation package of the Israeli subsidiaries’ employees with the objective of improving the quality of services rendered and strengthening the bond between the companies’ and employees’ cohesive goals. Therefore, such compensation should […]

Denmark vs. Corp, December 2016, Tax Tribunal, SKM2017.115

The case relates to controlled transactions between a Danish company and its permanent establishment, as well as the calculation of taxable income of the permanent establishment. The Danish Tax Administration was entitled to make tax assessment in accordance with applicable Tax Law. The transfer pricing-documentation provided by the Company lacked a comparability analysis. The assessment was in line with the OECD Transfer Pricing Guidelines, but some corrections to the tax assessment were made.

Denmark vs. Bombardier, October 2013, Administrative Tax Court, SKM2014.53.LSR

The issue in the case was whether the applicable rates under the cash pool arrangement were on arm’s length, i.e. in accordance with the transfer pricing requirements. The Administrative Tax Court upheld most of the conclusions of the tax authorities. First, the Court found that the tax authorities were allowed to assess an arm’s length rate due to the lack of transfer pricing documentation. Second, the financial service fee of 0.25% was upheld. Third, the […]

France vs SAS Groupe Lagasse Europe, January 2020, CCA de VERSAILLES, Case No. 18VE00059 18VE02329

A French subsidiary, SAS Groupe Lagasse Europe, of the Canadian Legasse Group had paid service fees to another Canadian group company, Gestion Portland Vimy. The French tax authorities held that the basis for the payments of service fees had not been established, and that there was no benefit to the French subsidiary. The payments constituted an indirect transfer of profits within the meaning of the ‘article 57 of the general tax code; Excerps from the […]

Tag: DAC

EU Transparency on Income Allocation and Tax Arrangements – DAC 1 to 6

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