Anyone who earns money via digital platforms – whether as a landlord on a booking platform, a seller on an online marketplace or a freelancer on a job-matching site – has long been the focus of the tax authorities. The German government is now planning to extend the automatic exchange of information on such income to include further countries outside the EU. A draft bill to this effect has been tabled.
What’s behind it?
Within the European Union, tax authorities have been automatically exchanging data on income generated via online platforms for some time now. This is based on the so-called EU Mutual Assistance Directive. So, if a platform such as Airbnb or eBay reports data on a seller resident in Germany to the relevant authority, this information is also passed on to the German tax office.
Until now, however, this had only applied in relation to EU Member States. The new Act is intended to transpose the so-called Multilateral Agreement of 22 June 2021 into German law. Germany signed this agreement, which was developed under the auspices of the OECD, in November 2024. It obliges the participating states to automatically exchange tax-relevant information on platform revenues with third countries as well.
What does this mean for platform operators and users?
Until now, platforms based outside the EU had faced the prospect of a double burden: reporting obligations in their country of establishment, coupled with their own registration and reporting obligations within the EU. The new agreement provides a solution to this. If a third-country platform fulfils equivalent reporting obligations in its home country and there is an effective system of information exchange with EU Member States, the requirement for dual reporting is waived.
For taxpayers in Germany, this means one thing above all else in practice: income generated via digital platforms is increasingly coming to the attention of the tax authorities. In future, this will no longer apply solely to EU-related transactions, but also to transactions carried out via platforms based in countries such as the United Kingdom, Canada or other OECD member states.
Data protection is ensured
The draft bill expressly stipulates that the exchange of data is subject to comprehensive data protection requirements. The information transmitted is sent exclusively to the tax authorities of the respective country and is not published.
What should those affected bear in mind?
Anyone who regularly earns income via digital platforms and has not yet declared this, or has not declared it in full, on their tax return should follow developments closely. International authorities are cooperating ever more closely in the detection of tax evasion. Anyone who is unsure as to whether and how such income should be treated for tax purposes should seek tax advice at an early stage to avoid having to pay back taxes or facing criminal tax law consequences.
The draft bill is currently going through the parliamentary process. It cannot come into force until it has received final approval from the Bundestag.
Source: Haufe: Tax
This post and the accompanying image were created with the help of AI and have been editorially reviewed.
