On 25 May 2018 the EU Council published a directive amending Directive 2011/16/EU on the automatic exchange of information, which is known as DAC6. The amendment refers to the introduction of a new reporting obligation for cross-border tax arrangements that may potentially be regarded as aggressive and politically undesirable. The EU Member States are obliged to transpose the directive into domestic law by 31 December 2019.

The German federal government has now passed a draft law, broadly in line with EU requirements, that addresses the implementation of the mandatory disclosure of cross-border tax arrangements.

As of July 1, 2020, reportable cross-border tax arrangements must be disclosed to the tax authorities in a timely manner, and before the start of any tax audit here in Germany. In addition, the reporting obligations will also apply retroactively to cover reportable cross-border tax arrangements in which the first step is taken between June 25, 2018 and July 1, 2020.