At the beginning of this year, digital platform operators submitted their first DAC 7 report for 2023. The new reporting requirement applies to platforms that facilitate services or the sale of goods by individual sellers to end customers. These activities include real estate and vehicle rentals, personal services (such as various crafts or other services provided in person), and the sale of goods. The next reporting deadline for 2024 is fast approaching—platform operators must submit their reports by 31 January 2025.
Challenges faced by companies when filing their first report in 2024
When submitting their first DAC 7 report for 2023, companies encountered several challenges. The report had to be submitted electronically in XML format through the “My Taxes” portal. Many digital platforms faced technical difficulties in creating the XML files, as they were not prepared for the specific structure required by the OECD guidelines. In addition to technical issues, platforms struggled with ensuring the report met various validation rules, the details of which were not always easy to find. Based on feedback from our clients, the tax authorities often returned submitted reports to companies for corrections.
Common errors in DAC 7 reports and how they were corrected
Common mistakes in the first DAC 7 reports included issues like providing seller information in the wrong format or using incorrect platform codes. Correcting these errors required significant administrative effort, and in some cases, it took several months to make the necessary adjustments. Many platforms also faced challenges due to missing or poor-quality data in their systems. Since 2023 marked the first year that companies in the Czech Republic submitted DAC 7 reports, the tax authorities were understanding and allowed platforms to submit reports with some delays. They also provided technical guidance on how to correct errors. With the 2024 DAC 7 report due for submission, we expect the tax authorities to require higher-quality reports submitted on time.
We assisted our clients in preparing accurate DAC 7 reports in XML format and provided support in responding to requests from the tax authorities for error corrections. If your company is subject to the DAC 7 reporting requirement and you need professional assistance, feel free to contact us. Now is the perfect time to start preparing your data for the 2024 DAC 7 report to ensure it is submitted on time.
Seminars, webcasts, business breakfasts and other events organized by Deloitte.
