As of January 1, 2024, the new European DAC7 Directive (Directive 2021/514), relating to administrative cooperation in the field of taxation, will come into force. This obliges digital platforms to collect, verify, update and communicate data on the operations carried out by sellers on platforms such as eBay, Wallapop and even AirBNB: all those in which there is sale, rental of goods (personally or professional) or offering of services.
Online buying and selling and provision of services, under the spotlight. Starting in January 2023, both platforms and platform sellers have a legal obligation to report transaction data to tax authorities.
Whether or not they are residents of the EU, platforms must report the income earned by sellers. Among the activities subject to reporting, called by the directive as “relevant activities”, the following are included:
- The leasing of real estate, which includes real estate for residential use and commercial use and any other type of real estate, as well as parking spaces.
- Personal services.
- The sale of “goods”.
- The leasing of any means of transport.
The data to collect. The information communicated regarding sellers and service providers refers to their name and identification (company name, address, tax identification number and NIF/VAT number). In the event that the seller provides leasing services, data related to the physical address of the property and days of leasing must be provided. Data such as:
- Bank details: account or card number linked to your account, and name of the owner if different.
- Total money obtained each quarter.
- Number of sales made each quarter.
- Any fees, taxes or commissions withheld or collected.
The platforms explain the figures. Websites such as Wallapop or eBay carefully explain when our transactions will be reported to the relevant tax authorities. This data will be sent if:
- We are residents in the EU
- If in a calendar year the consideration you obtain for your sales is equal to or greater than 2,000 euros (after deducting fees, commissions or taxes) or if you make more than 30 sales, regardless of the amount.
In these scenarios, we will be notified through the application or email that it is necessary to fill out the legal information in our profile, and we will be required to fill it out within 60 calendar days. Otherwise, the platforms will block our account.
In the case of platforms like AirBNB, any host with a property located in one of the 27 EU member states will have their information shared through the platform (amounts earned by AirBNB per quarter, account identifier, number of days rented, etc.).
If hosts do not provide the information required to be reported to tax authorities, Airbnb will have to freeze payments. In some situations, Airbnb may block hosts’ calendars.
Tax obligations do not change. It is important to note that DAC7 does not change the tax obligations of sellers. The main change comes in that now, the platforms will be obliged to communicate our data.
It is a method of the EU to control all the information related to the transactions that it considers relevant. If the user does not want to provide this data, their account will be blocked.
