DAC7: which platform operators are in scope?.

Gate one: the operator

A platform is software that allows sellers to connect with users to carry out a relevant activity. A platform operator is the entity that contracts with sellers to make the platform available to them. The reporting obligation attaches to a reporting platform operator, and the Directive splits that population in two.

• Union operators — resident for tax purposes in a member state, or incorporated there, or managed from there, or holding a permanent establishment there.
• Non-Union operators — meeting none of those connecting factors, but facilitating relevant activities carried out by reportable sellers, or the rental of immovable property located in a member state.

Operators excluded from the definition include those whose model does not put them between seller and user in the way the Directive describes — for instance where the software only processes payments, only lists or advertises, or only redirects users elsewhere without any facilitation of the underlying activity.

Gate two: the relevant activity

Only four activities are relevant, and each is qualified by being carried out for consideration.

Consideration must be known or reasonably knowable to the operator. Where a platform never sees the amount paid — because settlement happens entirely outside it — that is a scope argument worth documenting, not an assumption to rely on silently.

Gate three: the reportable seller

A seller is reportable where it is registered on the platform, carried out a relevant activity during the reportable period, and is resident in a member state or rented out immovable property located in one. Several categories are excluded, including governmental entities, entities whose stock is regularly traded, large-volume property operators above a defined number of rentals for the same listing, and small-scale goods sellers below both a transaction count and a consideration threshold in the period.

Non-Union operators and equivalence

A non-Union operator in scope registers in a single member state and reports there. Where an operator is resident in a third country whose reporting regime the Commission has determined to be equivalent, and the information reaches member states under that regime, the operator can be relieved of reporting under the Directive for the covered sellers. Equivalence is determined by jurisdiction and by scope of information, so it is checked rather than assumed — and it does not follow that every seller is covered by it.

Due diligence and verification

The operator collects seller identity, residence and tax identification number, and for entity sellers the business registration number and any permanent establishment through which activity is carried out. For property rentals it also collects address and, where held, land registration details for each listed property.

The collected data must be verified as reliable using records the operator already holds and, where available, publicly accessible electronic interfaces confirming identification numbers. Sellers who do not supply the required information after reminders are subject to closure of their account or withholding of payment, depending on the transposition in the member state concerned. That consequence is the reason due diligence design cannot be left until the first reporting cycle.

REGREP is an independent software provider. This record explains a reporting framework in plain language and is not legal, tax or regulatory advice. Confirm scope, thresholds and submission dates with your competent authority before you file.