Council Directive (EU) 2018/822 of 25 May 2018, hereafter DAC 6, is an EU directive that imposes an obligation on advisers to provide information to the relevant tax authority on their clients’ cross-border arrangements. The purpose of the information obligation is to combat tax avoidance and evasion.

The legislation entered into force on 1 July 2020. See the full text of the law here.

An arrangement is reportable if it is cross-border between two or more countries and exhibits at least one so-called characteristic. The characteristics are intended to indicate risks of tax avoidance and in several cases also require that a tax benefit is a principal advantage. The reporting obligation also applies to advisors who participate in the arrangement without having provided tax advice.

Swedish lawyers have a statutory duty of confidentiality. For this reason, lawyers are considered to be prevented from reporting cross-border arrangements under DAC 6 to the relevant tax authority. In the first instance, other advisors must report this to the relevant authorities and, in the second instance, it is up to the client to ensure that the reporting obligation is fulfilled. A client can always leave a specific instruction to us at Wesslau Söderqvist Advokatbyrå to report the arrangement to the relevant authority if the client so wishes.

The legislation requires us to inform other counsellors that we are prevented from reporting arrangements to the relevant authority. According to the Swedish Bar Association, we cannot inform other counsellors without breaching our statutory duty of confidentiality. This means that we will not inform other advisers specifically about their duty to report arrangements to the relevant authority under DAC 6.”