EU Council Adopts DAC9 Directive to Simplify Pillar Two Tax Reporting

The Council of the European Union has officially adopted the DAC9 directive as of April 14, marking a significant step in aligning pillar two tax reporting across the bloc. The new legislation is aimed at enhancing cooperation and streamlining the exchange of information among EU tax authorities in relation to the global minimum tax regime under pillar two.

According to the Council, DAC9 introduces a uniform format for the top-up tax information return (TTIR), which will significantly simplify the reporting obligations for multinational entities. Rather than requiring each subsidiary within a multinational group to submit individual reports, a single constituent company will be able to file a consolidated TTIR on behalf of the entire group.

The Council previously stated that this level of standardisation is designed to alleviate administrative burdens not only for companies but also for national tax authorities. By unifying the reporting format, DAC9 is expected to foster greater efficiency and clarity throughout the compliance process.

In addition to easing filing procedures, the directive also establishes mechanisms for the efficient exchange of relevant data between tax administrations of EU member states. This increased coordination is intended to ensure more robust enforcement and monitoring under the global anti-base erosion framework.

Member states are required to transpose the directive into national law by December 31, 2025. This includes enacting the necessary legislative, regulatory, and administrative measures to comply with the directive’s provisions.

The first round of top-up tax reporting under DAC9 will be due by June 30, 2026. Even countries that choose to defer implementation of the broader pillar two rules are still obligated to meet this transposition deadline, the Council confirmed.

The DAC9 framework was originally put forward by the European Commission in October 2024 as part of its continuing efforts to modernize and harmonize tax administration in line with global tax reforms spearheaded by the OECD and G20.

By fLEXI tEAM