On 24 June 2026, the European Commission published proposal COM(2026)308 final to recast Directive 2011/16/EU on administrative cooperation in taxation (the "DAC"). The proposal would consolidate DAC1 to DAC9 into a single legal act and introduce targeted substantive amendments across several reporting regimes. Pending adoption, the existing DAC rules remain in force, but the recast would streamline the nine directives into one, cutting compliance costs and narrowing DAC6 obligations.
Background and context
The DAC is the main EU legislation on administrative cooperation in direct taxation. Since 2011, eight successive amendments have expanded its scope to financial accounts (DAC2), cross-border tax rulings (DAC3), MNE country-by-country reporting (DAC4), beneficial ownership (DAC5), reportable cross-border arrangements (DAC6), digital platform income (DAC7), crypto-assets (DAC8) and the global minimum tax (DAC9).
This has produced a fragmented, complex legal structure which, according to the Commission, undermines legal clarity and certainty, with certain requirements (notably under DAC4/DAC9, DAC6 and DAC7) generating large volumes of low-relevance information and disproportionate compliance burdens.
By codifying the nine directives into a single, more coherent instrument, the recast improves legal clarity and introduces key simplifications that reduce administrative burdens and make the framework more efficient for both businesses and tax administrations.
One of the most impactful changes is the reduction of reporting obligations: the recast removes cross-border reporting requirements for roughly 3,000 MNE groups already subject to the 15% Pillar Two minimum tax, saving an estimated EUR 300 million annually, and eliminates reporting for all other companies (including SMEs) on arrangements of limited value to tax administrations.
DAC6 - the main proposed changes
A targeted Pillar 2 carve-out
The Commission's preferred package would exclude from DAC6 companies within scope of the Pillar 2 Directive, subject to conditions preserving the 15% minimum-tax outcome, including qualified domestic top-up taxation and the absence of refunds or other benefits undermining that result. Pillar 2 status is therefore not an automatic exemption without checking the detailed conditions.
Reporting period
The reporting period is amended in two ways: it now starts from the first concrete, verifiable implementation step (such as signing contracts that make the arrangement irreversible or legally binding), and the intermediary reporting deadline is extended from 30 to 90 days to ensure better quality and completeness of information.
Category A hallmarks would be deleted, while the Main Benefit Test would remain
The generic Category A hallmarks (confidentiality clauses, success-fee arrangements and substantially standardised arrangements) would be removed. The MBT would continue to apply to the remaining hallmarks subject to it, with the Commission's package envisaging guidance for more consistent application across Member States.
Further hallmark adjustments are proposed
For Hallmark C.1, the reference to OECD work on non-cooperative jurisdictions would be replaced by the EU's own process for assessing third-country jurisdictions. The criteria for Hallmark D.2, on non-transparent ownership chains, would be further specified through a Council implementing act.
Legal professional privilege would be revised in light of CJEU case law
In line with recent CJEU judgments, legal professional privilege would be understood to apply only to lawyers and other professionals legally authorised to ensure legal representation. Member States should therefore limit the waiver from filing information on a reportable cross-border arrangement to professionals authorised under national law to ensure legal representation.
DAC7 - higher threshold for sellers of goods
The proposal would simplify the exclusion threshold for the sale of goods through digital platforms
The current test combines a 30-transaction activity threshold with a EUR 2,000 monetary threshold. The Commission proposes to remove the transaction threshold and raise the monetary threshold to EUR 3,000, avoiding reporting for low-value occasional sellers while retaining it for more material activity.
DAC4 and DAC9 - one group notification instead of overlapping notifications
A single notification would cover both country-by-country reporting and the Pillar 2 top-up tax information return.
The filing constituent entity of an MNE group could submit one notification, using a common standard form, on behalf of all EU-resident group entities, no later than the last day of the group's Reporting Fiscal Year, with the receiving Member State exchanging it with other Member States concerned.
This central-filing approach replaces duplicative entity-by-entity notifications and harmonises the timeline and information required for DAC4 and DAC9.
TIN verification - a centralised EU verification tool
The Commission would develop a digital and automated TIN verification tool.
Member State tax authorities would need electronic confirmation of TIN validity in specified exchanges, while reporting entities could use the tool voluntarily, improving matching of exchanged information and reducing errors from incomplete or inaccurate identification data.
DAC1 - broader completeness of exchanges, but removal of life insurance products
The life insurance products category would be removed from DAC1.
The Commission considers that only a limited number of Member States exchange information under this category, which significantly overlaps with financial-account reporting under other DAC provisions.
Proposed timetable
Implementation is phased. The DAC6 amendments and DAC7 seller-threshold change are scheduled for transposition by 31 December 2027 and application from 1 January 2028. The more IT-intensive DAC4/DAC9 notification reform, TIN verification framework and DAC1 changes follow in a later 2030 phase. These dates may change during the legislative process.
What this means for you
Intermediaries and taxpayers should not change current reporting practices yet: the recast is only a proposal, and the existing DAC framework applies until new rules are adopted, transposed and applicable.
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