The European Directive on administrative cooperation in the field of taxation – DAC 6 – obliges persons who provide legal or tax advice as well as taxpayers to report cross-border arrangements that may be driven by the acquisition of a tax advantage.
The information obtained will then serve as part of the international exchange of information.
Depending on how it is implemented in Czech law, the Directive could negatively affect the confidentiality obligation. The purpose of attorney confidentiality is to protect clients’ and the whole company’s interests. Therefore, our firm will actively participate in the activities of the professionals, including the Czech Bar Association, while maintaining the confidentiality obligation in the attorney-client relationship. We will continue to address this topic intensively.
The obligation to report concerns all types of direct taxes imposed by Member States. The amendment to the tax law does not accurately define the types of reporting obligations. It only generally defines the criteria for the obligation to report to the tax administrator. Member States must adopt the Directive by 31 December 2019 and apply it from 1 July 2020.
