DAC7 is a tax directive in the EU that came into effect on January 1, 2023 that requires digital platform operators – generally, platforms that enable the sales of goods and services by connecting sellers with buyers – to report certain information about their sellers to tax authorities. Additionally, this information is exchanged among other EU Member States.
Who does DAC7 affect?
The reporting obligation applies to digital platform operators that are managed, incorporated, or permanently established in the EU. DAC7 reporting obligations also apply to non-EU-based digital platform operators including companies that operate in any EU Member States, or have buyers or sellers located in an EU Member State.
Under DAC7, Flight Club is required to report certain personal and transactional data of EU sellers who, in one calendar year, have made 30 or more transactions or whose transactions exceed €2,000 in revenue, net of fees.
EU sellers with less than 30 transactions and whose transactions do not exceed €2000 in revenue, net of fees, in one calendar year are not subject to the DAC7 reporting rules.
How are my sales calculated for DAC7 purposes?
For DAC7 purposes, your sales total will equal the amount received from your transactions. The following amounts are excluded from your sales’ calculation: any shipping amounts paid to Flight Club, VAT collected and remitted by Flight Club, VAT charged on fees, and any amounts deducted by Flight Club for fees, or canceled or returned orders.
Is there any impact on my tax obligations?
DAC7 does not change your tax obligations; however, sellers should be sure to monitor their transactions to comply with any relevant reporting obligations that may be required based on your total sales activity. DAC7 only addresses whether Flight Club must report certain personal and transactional data of its sellers to the relevant tax authorities.
Please note that Flight Club is not a tax consultant. For specific questions regarding your taxes, please reach out to your tax advisor or accountant.
What information is reported for DAC7?
The information collected and shared with the relevant tax authorities (listed below) is dependent on whether you are an individual seller or a legal entity/business.
|Individual Sellers||Legal Entities/Businesses|
|First and Last Name||Business/Legal Entity Name|
|Primary Address||Primary Address|
|Member State Residence||Member State Residence|
|Date of Birth||Business Registration Number|
|Tax Identification Number (or Place of Birth if TIN is not available)||Tax Identification Number|
|VAT Identification Number (if applicable)||VAT Identification Number|
|The total amount paid or credited to the seller, excluding fees paid to Flight Club, any refunds or canceled orders, or VAT collected by Flight Club.||The total amount paid or credited to the seller, excluding fees paid to Flight Club, any refunds or canceled orders, VAT collected by Flight Club.|
|Total Number of Transactions||Total Number of Transactions|
|Total fees, commissions charged, and taxes withheld by Flight Club.||Total fees, commissions charged, and taxes withheld by Flight Club.|
|Bank account number where sales’ proceeds are paid.||Bank account number where sales’ proceeds are paid.|
As part of the reportable data under DAC7, Flight Club is legally required to collect your Tax Identification Number (TIN) or place of birth if you are an individual and don't have a TIN. If you do not have a TIN, you may be able to apply for one by reaching out to your local tax authority or a tax professional.
Please note that your TIN is different from a VAT Identification Number. If you are required to provide a TIN and choose not to, your account may be subject to cashout freezes or restricted selling privileges.
How is my personal data being protected?
In order to comply with European and UK privacy legislation (such as the EU and UK GDPR), Flight Club, as a digital platform operator, takes various measures to protect your personal data and to process your personal data in accordance with any applicable privacy laws. This includes, among other things, informing individual reportable sellers that their information will be collected and reported to the relevant authorities.
For questions regarding privacy, data protection, and the GDPR, please contact firstname.lastname@example.org.