As the first deadline for DAC7 approaches, online platforms are finding it difficult to comply with the reporting obligations imposed by the European Union (EU). The challenge lies in collecting and validating data on sellers resident in the EU and non-EU residents renting out property in an EU member state. DAC7 was introduced to increase tax administrations’ knowledge of selling activities on online platforms. It requires platforms to collect information on sellers, such as their names, addresses, tax identification numbers, VAT numbers, and date of birth. The aim is to reduce tax evasion. Online platforms must communicate with their sellers and introduce systems to collect and validate the required data. Verifying tax numbers can be challenging due to different formats and validation services across jurisdictions.
Source Iman Deschâtres
