DAC 8 – Upcoming EU reporting requirements for crypto and digital asset service providers  | Deloitte Netherlands


DAC 8 – Upcoming EU reporting requirements for crypto and digital asset service providers

On 7 December, the European Commission (“EC”) will publish a new addition to the Directive 2011/16/EU on Administrative Cooperation in the field of taxation (“DAC”), which will introduce tax reporting requirements for digital asset and cryptocurrency transactions. In this alert we discuss the likely content of the DAC8 proposal.

7 December 2022

In the proposed Council Directive annual reporting obligations will be introduced for service providers such as crypto-exchanges and marketplaces in a new amendment to the DAC called DAC8. A broad range of digital assets will likely be in the scope of DAC8, including stablecoins and non-fungible tokens (“NFTs”).

The reporting obligations for DAC8 are expected to be similar to those coming into force in 2023 under DAC7 and 2024 under CESOP, which will introduce reporting obligations for platform operators and payment service providers respectively (we refer to our DAC7 and CESOP websites for more information). Additionally, DAC8 is likely to align with the OECD’s recently published Crypto-Asset Reporting Framework (“CARF”), a G20-backed initiative intended to standardize crypto-asset reporting transactions, enabling information exchange between countries.

With these considerations, DAC8 is predicted to include the following requirements for reporting service providers:

  • Yearly reporting of the value of reportable transactions effectuated by the service provider per reportable user, per digital asset or cryptocurrency;
  • Extensive onboarding process for customers, collecting information such as the name, address, Tax Identification Number (“TIN”), date and place of birth of reportable users.

Reportable transactions likely include exchanges between digital assets or cryptocurrencies and fiat currency, as well as exchanges between one or more forms of digital assets or cryptocurrencies and transfers of these assets. Reportable persons will probably be all entities and individuals who are residents of EU Member States who are customers of reporting entities for the purpose of making reportable transactions.

The new onboarding requirements could require that service providers repeat the onboarding of existing customers before DAC8 comes into force, after which date customers who have not provided all the relevant information may no longer be served. For customers who are entities, collecting personal data of the controlling persons of that entity may be part of the onboarding process.

Persons already in the scope of similar reporting requirements, such as those of DAC7 or CESOP, may be excluded from the reporting obligations of DAC8.

While the specific details of DAC8 might differ slightly from those of CARF, DAC7 and CESOP, the scope of the reporting obligations of DAC8 can be expected to be the same as those of CARF mostly. When the EC publishes DAC8 on 7 December, we will release an in-depth analysis of the reporting requirements and compare them to those of CARF, DAC7 and CESOP.

It is uncertain when DAC 8 will come into force, but when it does it will have a major impact on companies providing services related to digital assets and cryptocurrency in the European Union.

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