Sign up for tax alert emails    GTNU homepage    Tax newsroom    Email document    Print document    Download document

April 24, 2020
2020-5635

Latvia passes regulations to implement Mandatory Disclosure Rules

Executive summary

On 17 April 2020, the Latvian Government published Regulations of the Cabinet of Ministers No. 210 “Rules on automatic exchange of information on reportable cross-border arrangements’’ implementing the European Union (EU) Directive on the mandatory disclosure and exchange of cross-border tax arrangements (referred to as DAC6 or the Directive). Under DAC6, taxpayers and intermediaries are required to report cross-border reportable arrangements from 1 July 2020. However, reports will retrospectively cover arrangements where the first step is implemented between 25 June 2018 and 1 July 2020.1

The Latvian legislation was adopted on 14 April 2020 and will be effective from 1 July 2020.

The final Latvian Mandatory Disclosure Rules (MDR) legislation is broadly aligned to the requirements of the Directive.

Key highlights

  • The final legislation does not contain many changes to the draft legislation as published in December 20192 except for the Legal Professional Privilege (LPP) exception.
  • The Latvian final legislation gives the right to a waiver for intermediaries that are attorneys at law from filing information where the reporting obligation would breach the LPP. Where this applies, the intermediaries must notify any other intermediary, or if there is no such intermediary, the relevant taxpayer of their reporting obligations.

 

Next steps

Determining if there is a reportable cross-border arrangement raises complex technical and procedural issues for taxpayers and intermediaries. Taxpayers and intermediaries who have operations in Latvia should review their policies and strategies for logging and reporting tax arrangements so that they are fully prepared for meeting these obligations.

A detailed Global Tax Alert is forthcoming.

Endnotes

1. See EY Global Tax Alert, EU publishes Directive on new mandatory transparency rules for intermediaries and taxpayers, date 5 June 2018.

2. See EY Global Tax Alert, Latvia publishes draft proposal to implement Mandatory Disclosure Rules, dated 2 March 2020.

______________________________________________________________________________________

For additional information with respect to this Alert, please contact the following:

Ernst & Young Baltic SIA, Riga

ATTACHMENT

 
 

The information contained herein is general in nature and is not intended, and should not be construed, as legal, accounting or tax advice or opinion provided by Ernst & Young LLP to the reader. The reader also is cautioned that this material may not be applicable to, or suitable for, the reader's specific circumstances or needs, and may require consideration of non-tax and other tax factors if any action is to be contemplated. The reader should contact his or her Ernst & Young LLP or other tax professional prior to taking any action based upon this information. Ernst & Young LLP assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect the information contained herein.

 

Copyright © 2024, Ernst & Young LLP.

 

All rights reserved. No part of this document may be reproduced, retransmitted or otherwise redistributed in any form or by any means, electronic or mechanical, including by photocopying, facsimile transmission, recording, rekeying, or using any information storage and retrieval system, without written permission from Ernst & Young LLP.

 

Any U.S. tax advice contained herein was not intended or written to be used, and cannot be used, by the recipient for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code or applicable state or local tax law provisions.

 

"EY" refers to the global organisation, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients.

 

Privacy  |  Cookies  |  BCR  |  Legal  |  Global Code of Conduct Opt out of all email from EY Global Limited.

 


Cookie Settings

This site uses cookies to provide you with a personalized browsing experience and allows us to understand more about you. More information on the cookies we use can be found here. By clicking 'Yes, I accept' you agree and consent to our use of cookies. More information on what these cookies are and how we use them, including how you can manage them, is outlined in our Privacy Notice. Please note that your decision to decline the use of cookies is limited to this site only, and not in relation to other EY sites or ey.com. Please refer to the privacy notice/policy on these sites for more information.


Yes, I accept         Find out more