Author

A Complete Guide Introduction to DAC 7

DAC 7

Dec 5, 2025

1806

Anna Chui

Author

A Complete Guide Introduction to DAC 7

DAC 7

Dec 5, 2025

1806

Introduction to DAC 7

When the DAC7 Directive came into force, marketplace reporting ceased to be the sole responsibility of the tax department. For companies with significant platform turnover, C-level teams regularly engage in DAC7 threshold discussions, as these executives are responsible for decisions regarding data architecture, investment volumes, and legal risk levels.

In typical practice, the C-level team considers the DAC7 Directive as part of the overall tax transparency framework , along with automatic information exchange regimes and revenue line items in public reporting. This helps ensure that DAC7 thresholds are not taken out of context, but rather assess their impact on the platform’s business model, KYC design, and interactions with non-residents.

DAC7 Thresholds Basics and DAC 7 Practice in the EU

The basic structure of DAC7 thresholds in the EU is simple. To sell goods through the platform, a seller becomes accountable if they have completed more than 30 transactions on a single platform in a calendar year or received at least €2,000 in remuneration. This is a direct DAC 7 rule, enshrined in the DAC 7 Directive, and most EU countries implement it without modification.

DAC 7 thresholds are not used for services, real estate rentals, and vehicle rentals. Under the DAC 7 Directive, such transactions are considered accountable from the first relevant transaction, so product and finance teams must carefully label transaction types to avoid confusing goods and services within the same accounting system.

It is important to note that the DAC 7 thresholds themselves are not included in the report file. The DAC 7 download only shows filtered sellers and aggregated amounts by quarter. Threshold selection is pre-defined within the DAC 7 reporting requirements and is verified during internal tax audits.

Rule element	Value under DAC7 (EU)
Transaction threshold	More than 30 transactions per calendar year
Value threshold	More than EUR 2,000 in consideration
Activities without thresholds	Real estate rental, services, transport
First EU reporting period	Transactions from 1 January 2023
First unified deadline	31 January 2024

This table reflects the basic logic of the DAC7 thresholds and helps C-level teams quickly compare DAC7 EU requirements with local jurisdictions that have implemented similar rules.

How DAC 7 reporting requirements change platform management

The DAC 7 reporting requirements detail which fields the platform must collect for sellers. These fields include name, address, tax identification number, country of residence, account ID, as well as remuneration and transaction totals by quarter and year. Essentially, DAC7 thresholds are based on these aggregates.

For CTOs and CPOs, the key question is how to integrate DAC7 thresholds into existing user flows. If the platform is separated by legal entities and domains, DAC7 reporting requirements require unified vendor identifiers and a clear rule for where the master record is stored to avoid discrepancies between the financial system and the DAC7 report.

CFOs and tax directors typically enshrine DAC7 thresholds in their accounting policies, and include DAC7 reporting requirements in the key control matrix. This matrix includes checking the validity of tax identification numbers, reconciling DAC7 file amounts with GL, and a correction procedure if the tax authority returns a file due to errors.

Regional DAC7 EU and EU DAC 7 Framework for Marketplaces

The DAC7 EU framework is based on the OECD model rules for platforms. The EU was the first major bloc to implement these model rules in the form of EU DAC 7, and subsequently became a benchmark for other countries, including Canada and the UK.

Under DAC7 EU, all EU countries use a common architecture of DAC7 thresholds for goods and a common approach to services and rentals, but details on deadlines, file formats, and penalties are specified in national legislation. Meanwhile, information exchange between tax authorities is based on a single agreement on automatic exchange.

It is especially important that EU DAC 7 also affects platforms from third countries. If a platform targets EU sellers or real estate in the EU, it may fall under DAC 7 obligations by registering in one of the EU countries. This should be taken into account by C-level teams of global groups that manage multiple platforms worldwide.

Comparison of DAC7 thresholds and deadlines in the EU, Australia, Canada, New Zealand, and the UK

While the EU operates through the DAC7 Directive, other countries rely on the same OECD model rules but formalize them differently. DAC7 thresholds are directly applied only in the EU, but the concepts of cutting off small sellers and setting fixed reporting deadlines are replicated in other regimes.

Country / regime	Legal basis	Start of transaction tracking	First reporting year	First filing deadline	Threshold specifics
EU (dac7 EU)	dac7 directive	1 January 2023	2023	31 January 2024	30 transactions or EUR 2,000 for goods; no thresholds for services/rentals
Australia (SERR)	OECD MRDP	1 July 2023 (rideshare & accommodation), 1 July 2024 (other platforms)	2023–24 / 2024–25	31 January or 31 July; key full-scope deadline: 31 January 2025	No transaction/value thresholds; depends on activity type and seller status
Canada	OECD MRDP	1 January 2024	2024	31 January 2025	Canada’s regime officially recognised by the EU as equivalent to DAC7
New Zealand (DPI)	OECD MRDP	1 January 2024	2024	7 February 2025	Focus on services and rentals; goods module not yet fully implemented
United Kingdom	OECD MRDP + UK regs 2023	1 January 2024	2024	31 January 2025	Thresholds defined through small-seller exceptions; structure similar to eu Dac 7

India, Singapore, and Switzerland: Approaches to DAC7 Thresholds,

India

India does not yet have a unified regime fully analogous to the DAC7 thresholds. Instead, the government is strengthening regulation of platform labor and discussing taxation of digital platforms as part of tax reforms and BEPS. Research on digital platform taxation in India and new labor codes emphasize worker protection and income distribution, but do not introduce a direct equivalent to DAC 7 marketplace reporting.

For C-level teams at global marketplaces, this means that in India, monitoring labor laws and tax regulations is more important than following a copy of the DAC 7 thresholds, although general principles for transparently reporting platform sellers’ income are already being discussed.

Singapore

Singapore has traditionally been quick to adapt international tax transparency standards, but has not yet introduced its own version of the DAC 7 thresholds for marketplaces. The country’s focus is on country-by-country reporting for international groups and a separate law on platform workers, the Platform Workers Act 2024, which covers protections for couriers and drivers, rather than information reporting for sellers similar to DAC 7.

At the same time, Singapore’s tax authorities closely follow the OECD model rules for platforms. This is evident in their active participation in the global agenda and the structure of their digital economy analysis in relevant reports. For companies that have already implemented DAC7 thresholds in the EU, scaling the approach to Singapore assets is done through the general principles of the MRDP, rather than through a direct reference to the DAC7 Directive.

Switzerland

Switzerland has not yet implemented its own regime similar to the DAC7 thresholds for marketplaces. However, new VAT rules are important for platforms. According to them, from January 1, 2025, marketplaces are recognized as suppliers of goods in their own right in certain cases, even if they only operationally connect sellers and buyers.

Swiss divisions of international groups fall under the DAC7 EU if the platform works with EU sellers, and the exchange of information on digital platforms is initiated through automatic exchange agreements. Therefore, the EU DAC7 thresholds indirectly affect Swiss structures, although local law does not yet replicate the EU DAC7.

A Complete Guide Introduction to DAC 7 photo 1

How DAC7 Marketplace Reporting Impacts Global Platform Design

Even when a country does not formally adhere to the DAC7 Directive, C-level teams see that the DAC7 marketplace reporting approach is gradually becoming a global standard. Australia, Canada, New Zealand, and the UK are already using the OECD model rules, and the EU, through DAC7 EU, has specified thresholds and deadlines.
The practical effect is clearly visible at three levels of the DAC7 thresholds.

Data Architecture

Unified seller identifiers, activity type classifications, and minimum threshold counters are needed for the EU and countries using the MRDP.

Operational Processes

Seller due diligence, as required by the DAC7 reporting requirements, must be integrated into onboarding, payments, and support to avoid manual data collection at the end of the year.

Deadline Management

Specific dates (January 31, March 31, February 7, July 31, and others) appear on the C-level team calendar, and internal milestones for DAC7 thresholds and similar regimes are linked to them.

This approach helps view DAC7 marketplace reporting not as a local European issue, but as part of an overall multi-year program for tax transparency of digital platforms.

C-level checklist for updating processes for DAC7 reporting requirements

To keep DAC7 thresholds under control, many companies find it convenient to use a short working checklist at the C-level. It is based on DAC7 reporting requirements, but also takes into account the regimes of Australia, Canada, New Zealand, and the UK.

Jurisdiction Map

Update the list of countries where DAC7 thresholds or their analogs apply.

Mark where DAC7 EU is operational, where MRDP is used, and where future rules are still being discussed.

C-Level Responsibilities

Clearly define who at C-level is responsible for the DAC7 Directive, who is responsible for DAC 7, who oversees integration with the Canadian and Australian regimes, and who maintains the overall risk map.

Unified Data Model

Ensure that the system can calculate DAC7 thresholds and similar thresholds across all platforms within the group, and that DAC 7 marketplace reporting is generated using the same aggregates as internal management reports.

How DAC7 Thresholds Relate to Traditional Tax Thresholds

For C-level teams, it’s useful to distinguish DAC7 thresholds from classic tax thresholds used in personal or corporate taxation. In traditional tax systems, the definition of threshold usually refers to the level of income or turnover at which a certain tax rate or obligation starts to apply. These thresholds are designed to determine how much tax an individual or company pays, not whether a digital platform has to report a seller’s activity.

By contrast, DAC7 thresholds are reporting criteria. They define when a seller must be included in DAC7 marketplace reporting based on the number of transactions and the amount of remuneration, rather than the seller’s final tax liability. A seller can cross DAC7 thresholds (for example, more than 30 transactions or at least €2,000 in consideration on a platform) even if they remain below traditional tax thresholds in their home jurisdiction.

For platform groups, this means that system design and accounting policies should clearly separate:

Data used for applying national tax thresholds (income tax, VAT, etc.); and
DAC7-specific counters that determine when a seller becomes reportable under marketplace reporting regimes.

Keeping these concepts separate in data architecture, policies, and board reporting helps avoid confusion between local tax thresholds and the global transparency framework built around DAC7 and similar rules.

A Complete Guide Introduction to DAC 7 photo 2

Deadline Calendar

Consolidate the dates of January 31, 2025, March 31, 2025, February 7, 2026, January 31, 2026, and July 31 of each year into a single calendar, as well as internal deadlines for when the team must complete reconciliations before submitting files for DAC 7 reporting requirements and related regimes.

Risk Reassessment

Include DAC7 thresholds and other platform reporting regimes in regular tax and regulatory risk reviews to ensure that fines and additional assessments don’t come as a surprise to the board.

Development Plan

Document how the organization will adapt to new countries adopting the MRDP and to possible changes to the EU DAC 7, so that DAC 7 reporting requirements don’t have to be urgently redesigned every year.

In summary

It’s important for C-level teams to consider DAC7 thresholds as part of the global digital platform reporting framework. The EU sets specific dates and dates through the DAC7 Directive, while Australia, Canada, New Zealand, the UK, and other countries are following suit through the OECD model rules. A well-thought-out strategy for DAC 7, DAC 7 EU, EU DAC 7, DAC 7 Marketplace Reporting, and DAC 7 Reporting Requirements is no longer just “another compliance measure,” but a normal working tool for managing the tax risks of a platform business.

Frequently Asked Questions

Which sellers are subject to DAC7 thresholds in the EU

A seller of goods becomes reportable if they conduct more than 30 transactions or receive at least €2,000 in revenue on a single platform within a calendar year. For services, real estate rentals, and transport, there are no numerical thresholds under the EU DAC7 and EU DAC 7 requirements; reporting begins with the first relevant transaction.

What data must platforms collect in accordance with the DAC 7 reporting requirements

Platforms must collect the seller’s name, address, country of residence, taxpayer identification number, bank or account identifier, as well as the total remuneration amount and the number of transactions per quarter and per year. These fields are used for both DAC 7 marketplace reporting and for internal control.

Which sellers are subject to DAC7 thresholds in the EU

What data must platforms collect in accordance with the DAC 7 reporting requirements

Are DAC7 thresholds displayed in the submitted report file

No. The platform filters sellers by DAC7 thresholds before generating the file. The DAC 7 reporting requirements for the platform itself only include sellers already identified as covered and their aggregated data. How does DAC 7 impact non-EU platforms?

If a non-EU platform has EU-resident sellers or real estate located in the EU, it may be covered by the DAC7 EU Directive. In this case, the group typically establishes a single reporting entity in the EU and reports there, with tax authorities exchanging information with other Member States.

How do other countries relate to the DAC7 Directive

Australia, Canada, New Zealand, and the UK use regimes based on the OECD model rules, which are similar in spirit to the DAC7 Directive but have their own thresholds and deadlines. The EU DAC7 thresholds only apply within the Union, but many groups are aligning global data models with these rules.

What are the key reporting deadlines to consider

For the EU, the first major reporting deadline under the EU DAC 7 Directive was January 31, 2024, for 2023, with an extension to March 31, 2024, in some countries, such as Germany. For new regimes, the typical first deadline is January 31, 2025, or early February 2025, so C-level teams now track multiple fixed dates in a single calendar.

What should C-level teams focus on when reporting on the DAC 7 market

Three key aspects are important: a unified merchant and transaction data model, integrated due diligence and reconciliation processes, and a clear calendar linking DAC 7 thresholds, DAC 7 market reporting, and other MRDP-based regimes into a single management view.

Anna Chui

Tax Specialist at Lovat

Anna Chui is a Indirect Tax Specialist at Lovat,passionate about making complex tax procedures accessible and easy to understand . On the Lovat blog, she shares insights on intriguing tax facts, legislative updates, and practical guidance to help taxpayers navigate regulatory compliance with confidence. covering intriguing tax facts, legislative updates, and simplified explanations of regulatory compliance for taxpayers. Anna holds an Advanced Certification in VAT Compliance and Reporting from the London School of Business and Administration.Through her writing, she aims to empower businesses and individuals to approach taxation with clarity and certainty.