What does DAC7 mean and how does it affect me?

Introduction to DAC7

DAC7 is an enhancement to an existing EU directive [Directive 2011/16/EU], which aims at improving tax cooperation across EU nations. Wunderflats, as a German company operating within the EU, has to report specific legal information about the landlords using our platform, along with their property listings, to the German Tax Authorities.

DAC7 applies to all digital platforms facilitating the sale of goods or services, including property rentals. As Wunderflats is such a platform, we fall under its purview.

What Does DAC7 Mean for You?

Under DAC7, as an EU company, we are required to collect and report specific information (please see the following section: Information shared with the EU tax authorities) about our landlords and their rental transactions (see table below in the following section: Information shared with the EU tax authorities). This information will be reported annually to the German Tax Authorities and takes effect from 1. January 2023. This means that if you're a landlord using Wunderflats, your rental income is subject to DAC7 reporting.

This data will then be circulated amongst tax authorities of different EU member states and is designed to streamline tax collection processes. It's anticipated that local tax agencies will utilize this data, possibly to pre-fill sections of your tax returns and ensure accuracy in tax reporting.

Data Security and Legal Obligations 

We prioritize the confidentiality and security of the data we collect. Wunderflats adheres to strict data protection policies, ensuring that your personal and transactional information is handled with the utmost care and security.

Wunderflats is committed to full compliance with DAC7 regulations. This means we diligently gather and report the necessary information to meet the requirements set forth by the directive. These regulations are part of our effort to ensure transparency and accountability in digital transactions.

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How to submit the necessary information

A step-by-step guide to entering the required tax information can be found here.

Support for Landlords

At Wunderflats, we understand that navigating these new requirements can be challenging. We are here to provide support and guidance to our landlords. Our team is dedicated to assisting you with any questions or concerns regarding DAC7 and its impact on your listings.

• Can I update my listings or create new ones before I provide my TAX information?
• Can I continue accepting booking requests if I haven’t yet submitted my TAX information for a particular listing?
• How do I regain my ability to accept listing requests if my listing is restricted due to missing Tax Information?
• What happens to my existing bookings if I don’t provide my Tax Information?

For landlords with listings in multiple countries, the tax requirements under DAC7 are as follows:

Primary Residence in the EU: If your main residence is in an EU member state, you should provide your Tax Identification Number (TIN) for that country.

Property-Specific Information: For each listing, include the land registration details of the property's location.

Managing Listings for Others: If you're managing listings for a property you don't own, it's crucial to use the property owner's tax information. When managing multiple properties on your account, your taxpayer information should be provided for each listing. Additionally, you might be responsible for reporting the property owner’s tax information to the relevant authorities as part of DAC7 compliance.

For Landlords who do not want to share their information

If you choose not to provide the required taxpayer information for your account and listings by the specified deadline, Wunderflats will be compelled to submit any relevant data we already have to the tax authorities. Furthermore, we will be legally obligated to restrict your access to our platform for listing purposes. 

Information shared with the EU tax authorities

In adherence to DAC7 requirements, Wunderflats is required to gather and share specific information about advertisers with listings on our platform with the EU tax authorities, namely:

Tax Identification Number

A Tax Identification Number (TIN) is a unique identifier assigned by local tax authorities for tax management purposes. It's known by various names in different countries, such as national number, tax code, or security number. For DAC7 compliance, the focus is on the TIN related to income tax, distinct from VAT numbers used for value-added tax registration. When providing your TIN, ensure it adheres to the format specific to your country. This precise formatting is crucial for the proper management and reporting of tax-related activities under DAC7.