DAC 7 general
DAC7 requires digital platforms to report to the Dutch Tax Authorities the commercial activities of third parties facilitated through the digital platform made available.
Digital platforms will be required by Jan. 1, 2023, to provide information on:
- sellers of goods,
- service providers of personal services,
- landlords of real estate,
- transportation equipment rental companies,
using these platforms to the Dutch Tax Authorities. The Dutch Tax Administration will automatically share this information with other EU member states.
There is also a requirement that platform operators disclose the data they share with the Tax Office to sellers operating on the platforms.
What digital platforms are included?
In principle, both large and small digital platforms fall within the scope of DAC7. Because of the broad wording, websites and apps, among others, can quickly qualify as "digital platforms," however, there are exceptions for, for example, platforms that only process payments, refer users or place advertisements.
On its website[1], the Internal Revenue Service provides some examples that it believes fall within the scope of DAC7, including:
- A restaurant with third-party art on the wall. The restaurant sells this art through its own website.
- A vacation park that offers on its own website not only its own vacation homes, but also vacation homes of private persons.
- A website of a bank or insurer that uses a loyalty point system to offer third-party household goods for sale at a discount.
- A website where builders offer their services, with the process from quote to payment going through the platform.
- A website where multiple car dealers offer their cars, with buyers making payment through this website.
- A website of a local association on which third-party products are sold.
- A website where gyms can hire freelance instructors to take over classes in the event of illness or leave of permanent staff.
As an indication of the broad scope of DAC 7, the Tax Court considers that: "a broker is not excluded from DAC7. An internet site of an estate agent often has the function of an advertisement (e.g. linking to Funda). If the property itself is for sale/rent on the broker's internet site, then the rules of DAC7 apply and there is a reporting obligation."
Commercial activities
Digital platforms are not required to transmit all data relating to sellers to the Tax Office. There are exceptions regarding certain sellers, service providers or landlords, such as with respect to:
- Government agencies;
- Real estate rental entities with more than 2,000 transactions;
- Sellers of goods with less than 30 transactions and a total consideration not exceeding EUR 2,000.
Deadline Jan. 31, 2025
The deadline for reporting by platform operators for 2024 is Jan. 31, 2025. The deadline for new vendors in 2023 (1-1-23 - 31-12-2023) has already passed.
With respect to reportable sellers already registered on the platform on January 1, 2023 (so-called "existing sellers"), the data and information on these sellers must also still be reported no later than January 31, 2025. Failure to report, in a timely manner, incompletely or incorrectly may result in a substantial fine or penalty.
Lock
If you possibly qualify as a digital platform, it is necessary that you have a clear focus on the information obligation and all information to be provided in order to avoid possible fines and penalties. Get good advice from your Govers contact person, by phone at 040-2 504 504 or via the contact form below about the possible qualification and the necessary steps to be taken in time.
[1] https://www.belastingdienst.nl/wps/wcm/connect/nl/ondernemers/content/informatie-voor-fiscaal-dienstverleners-dac7