DAC 6 and Trust Registration Service – possible deferral?
We’ve asked HM Revenue & Customs (HMRC) whether they would consider deferring the commencement dates of the DAC 6 and the Trust Registration Service rules in the UK.
Both of these are based in EU Directives, but we consider there’s a strong case for deferral of both in current circumstances, given the burden they’ll place on both private and public sectors, including law firms. We understand that similar points have been raised elsewhere in the EU.
At the end of March, HMRC said that they’re carefully considering the representations they’ve received about whether the implementation of these rules will be delayed in light of the circumstances around COVID-19.
DAC 6 is EU Directive 2018/822 that introduces new disclosure and reporting rules for intermediaries involved in designing and promoting cross-border schemes that have certain hallmarks related to tax and tax reporting.
On 9 January 2020, the International Tax Enforcement (Disclosable Arrangements) Regulations 2020, Statutory Instrument 2020 No. 25 (the Regulations) were made.
The Regulations implement DAC 6 into UK law and will come into force on 1 July 2020.
The government consulted on a draft of the Regulations last year.
Trust Registration Service
The Trust Registration Service changes due to come out of the Fifth Anti-Money Laundering Directive will also be a compliance challenge, especially under current circumstances, as it will greatly expand the number and types of trusts that require registration, including in a range of commercial contexts.