# DAC7 Reporting: A Practical Guide for Platform Operators

> What DAC7 reporting requires from platforms: who must report, which activities are in scope, the seller data to collect, and the 31 January deadline.
- **Author**: Aarthi Poonia
- **Published**: 2026-07-31
- **Category**: Tax, Compliance, Marketplaces
- **URL**: https://dodopayments.com/blogs/dac7-reporting-platforms

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A marketplace founder in Berlin discovers in mid-January that she is supposed to file an XML report to her national tax authority listing every seller on her platform, their tax identification numbers, and how much each one earned per quarter. The filing deadline is 31 January. Nobody on the team has collected a TIN from anyone.

DAC7 is EU Council Directive (EU) 2021/514, which requires digital platform operators to carry out due diligence on their sellers and report those sellers' identity and earnings data to an EU tax authority once a year. The reporting deadline is 31 January of the year following the reportable calendar year, and the obligation applies to platforms based inside and outside the EU.

This guide covers who qualifies as a reporting platform operator, what is in scope, what data you must collect, the deadlines, the exclusions, and where a merchant of record changes the analysis.

## What DAC7 Reporting Requires, in One Page

DAC7 imposes three linked obligations on in-scope platforms: collect specified data on every non-excluded seller, verify that data, and report it annually. It is a tax transparency measure, not a tax collection measure. You are not being asked to withhold or remit anything.

The directive was adopted on 22 March 2021. Member States had to transpose it by 31 December 2022 and apply it from 1 January 2023, which made 2023 the first reportable period and 31 January 2024 the first filing deadline.

Scope is defined by activity, not by industry label. Four categories of "relevant activity" trigger the regime.

| Relevant activity | What it covers | Common platform examples |
| --- | --- | --- |
| Rental of immovable property | Residential and commercial property, any other immovable property, and parking spaces | Short-term stay marketplaces, coworking and storage listings |
| Personal service | Time-based or task-based work performed by one or more individuals at a user's request, online or offline | Freelance marketplaces, delivery and gig apps, tutoring platforms |
| Sale of goods | Goods, defined in the directive as any tangible property | Secondhand and handmade marketplaces, resale apps |
| Rental of any mode of transport | Vehicles, bikes, boats and other transport | Car-sharing and vehicle rental marketplaces |

Two exclusions inside the definition matter. Activity by a seller acting as an employee of the platform operator or a related entity is not a relevant activity. And because "goods" is defined as tangible property, a store selling purely digital downloads is not facilitating a sale of goods for DAC7 purposes, though a marketplace for freelance work almost certainly is facilitating personal services.

## Who Is a DAC7 Reporting Platform Operator?

You are a reporting platform operator if you are an entity that contracts with sellers to make available all or part of a platform, and you have an EU nexus or facilitate in-scope activity connected to the EU. The definition catches non-EU companies deliberately.

An EU-nexus operator qualifies if it is tax resident in a member state, or, failing residence, is incorporated under the laws of a member state, has its place of management (including effective management) there, or has a permanent establishment there without being a qualified non-Union platform operator. A platform with none of that still qualifies if it facilitates a relevant activity by reportable sellers or the rental of immovable property located in a member state. A US or Indian marketplace with EU sellers is squarely in scope.

The directive defines "platform" as any software, including a website or part of one and mobile applications, that lets sellers connect to other users to carry out a relevant activity, and covers any arrangement for the collection and payment of consideration for one. Three things are carved out. Software that, without any further intervention in carrying out a relevant activity, exclusively processes payments, exclusively allows users to list or advertise a relevant activity, or exclusively redirects users to a platform is not itself a platform. That carve-out is why a payment processor is not automatically a reporting platform operator, a distinction covered in our comparison of a [merchant of record versus a payment service provider](https://dodopayments.com/blogs/merchant-of-record-vs-payment-service-provider).

There is also an "excluded platform operator" status for operators that demonstrate upfront, and annually, to their competent authority that the platform's business model is such that it has no reportable sellers.

## Which Sellers You Must Report and Which You Can Exclude

A reportable seller is any active seller, other than an excluded seller, that is resident in a member state or rented out immovable property located in a member state. An active seller is one who provides a relevant activity during the reportable period or is paid or credited consideration for one. The directive lists four categories of excluded seller:

- Governmental entities.
- Entities whose stock is regularly traded on an established securities market, and related entities of such an entity.
- Entities for which the platform facilitated more than 2,000 relevant activities by means of the rental of immovable property in respect of a property listing during the reporting period.
- Sellers for which the platform facilitated fewer than 30 relevant activities by means of the sale of goods and whose total consideration did not exceed EUR 2,000 during the reporting period.

Read that last one carefully. The 30-activity and EUR 2,000 test is cumulative, both conditions must hold, and it applies only to the sale of goods. A freelancer earning EUR 400 from two personal service gigs on your platform does not qualify. The UK guidance on its equivalent regime states the same restriction explicitly: the exception does not apply to services, rental of transport, or rental of immovable property.

"Consideration" means compensation in any form, net of any fees, commissions or taxes withheld or charged by the platform operator, paid or credited to a seller, where the amount is known or reasonably knowable by the operator. If your ledger already nets platform fees before payout, that is the number the directive wants. The hard part is usually reconciling quarterly payout data, the same problem described in our walkthrough of [how merchant of record payouts and settlement work](https://dodopayments.com/blogs/mor-payouts-settlement-explained).

## What Seller Data a Platform Must Collect

The directive splits the data set by whether the seller is an individual or an entity. Everything below must be collected for each seller who is not an excluded seller.

| Data point | Individual sellers | Entity sellers |
| --- | --- | --- |
| Name | First and last name | Legal name |
| Primary address | Required | Required |
| TIN | Any TIN issued, including each member state of issuance. Where there is no TIN, the place of birth instead | Any TIN issued, including each member state of issuance |
| VAT identification number | Where available | Where available |
| Date of birth | Required | Not applicable |
| Business registration number | Not applicable | Required |
| EU permanent establishment | Not applicable | Existence of any PE through which relevant activities are carried out in the Union, where available, with the member state indicated |

On top of the identity set, the annual report carries financial data most product teams have to build for specifically:

- The financial account identifier to which consideration is paid or credited, insofar as it is available to the operator and the seller's member state has not opted out of receiving it.
- Where the account holder differs from the seller, the account holder's name and any other available financial identification information for that account.
- Total consideration paid or credited during each quarter of the reportable period, plus the number of relevant activities it relates to.
- Any fees, commissions or taxes withheld or charged by the platform during each quarter.
- For property rentals, the address of each property listing, its land registration number or national equivalent where available, and where available the number of days each listing was rented and the listing type.

Quarterly granularity is the detail that breaks naive implementations. Annual totals are not acceptable, and retrofitting quarterly buckets after the fact is painful, so design for it when you first [build a digital product marketplace](https://dodopayments.com/blogs/build-digital-product-marketplace) rather than in January.

## The DAC7 Reporting Timeline and Due Diligence Deadlines

DAC7 runs on a calendar-year cycle with two hard dates: due diligence must be complete by 31 December of the reportable period, and the report is due by 31 January of the following year.

```mermaid
flowchart TD
    A[1 Jan: Reportable period opens] --> B[Onboard sellers
collect name, address, TIN,
VAT number, DOB or reg number]
    B --> C[Verify collected data
against reliable records]
    C --> D[31 Dec: Due diligence
must be complete]
    D --> E[31 Jan: File report to
one competent authority]
    E --> F[31 Jan: Send each seller
a copy of their reported data]
    E --> G[Within 2 months of period end:
authorities exchange data
with other member states]
```

Two timing reliefs are built in. For sellers already registered as of 1 January 2023, or as of the date an entity becomes a reporting platform operator, due diligence may be completed by 31 December of the second reportable period rather than the first. And where multiple operators would report the same information, an operator is exempt if it holds proof under national law that another already reported it.

You report to one member state, not twenty-seven. An operator meeting the nexus conditions in more than one member state elects a single one for its filing, and non-EU operators register and report in a single member state. Member states then exchange the data among themselves using a standard computerised format within two months following the end of the reportable period.

Do not overlook the seller-copy obligation. By the same 31 January date, you must give each reportable seller the information you reported about them. Platforms already running a [customer portal](https://docs.dodopayments.com/features/customer-portal) have most of the surface they need.

## Penalties, Registration and Enforcement

Penalties for DAC7 non-compliance are set by each member state, not by the directive, so there is no single EU-wide figure to quote. The directive requires member states to lay down penalty rules for infringements of the national provisions adopted under it, and states those penalties must be effective, proportionate and dissuasive. Because amounts, triggers and appeal routes differ by country, confirm your exposure with a tax advisor in the member state where you file. Anyone quoting one flat EU penalty figure is oversimplifying.

Enforcement has teeth for non-EU platforms. The directive contemplates coordinated member state action against platforms from non-Union jurisdictions that ignore registration and reporting requirements, including preventing them from operating within the EU as a last resort. The UK version shows the shape of national rules: operators must register with HMRC by 31 January after the end of the reportable year, may face a penalty for failing to register on time, and must keep records for five years after the end of the relevant reportable period.

## DAC7 Reporting vs the OECD Model Rules and UK Rules

DAC7 is the EU implementation of a global standard, not a one-off European invention. The directive credits the OECD Model Rules for Reporting by Platform Operators with respect to Sellers in the Sharing and Gig Economy as the reference framework, and expects non-EU jurisdictions to adopt equivalent rules.

The United Kingdom did exactly that. UK digital platform reporting rules started on 1 January 2024, which made 2024 the first reportable year and 31 January 2025 the first filing deadline. UK reports go to HMRC by 11:59pm on 31 January for the previous calendar year.

| Feature | DAC7 (EU) | UK digital platform reporting |
| --- | --- | --- |
| Legal basis | Council Directive (EU) 2021/514 | UK domestic rules based on the OECD Model Rules |
| First reportable period | Calendar year 2023 | Calendar year 2024 |
| Filing deadline | 31 January following the reportable period | 31 January following the reportable year, by 11:59pm |
| Due diligence cut-off | 31 December of the reportable period | 31 December of the reportable period |
| Goods de-minimis | Fewer than 30 sales of goods and EUR 2,000 or less | Fewer than 30 sales of goods and EUR 2,000 or less, described as roughly GBP 1,700 |
| Seller copy | Required by the reporting deadline | Required by the reporting deadline |

For a platform with both EU and UK sellers, the data model is shared but the filings are not. Collect once against the stricter schema, then file separately, the same architectural principle behind multi-jurisdiction indirect tax covered in our guide to [automating global tax compliance](https://dodopayments.com/blogs/how-to-automate-global-tax-compliance-a-solopreneur-s-toolkit).

Equivalence agreements also matter. A qualified non-Union platform operator that reports equivalent information to a non-EU authority under a qualifying competent authority agreement can be relieved of reporting again in a member state. Whether your jurisdiction has such an agreement in force is a question for your advisor, and it changes over time.

## DAC7 Reporting Is Not a VAT Obligation

Filing a DAC7 report does not register you for VAT, and being VAT-registered does not satisfy DAC7. They are separate regimes with separate triggers, separate authorities in some countries, and separate deadlines.

DAC7 sits inside the EU's administrative cooperation framework, amending Directive 2011/16/EU. Its output is information sent to tax authorities. VAT rules determine whether you must charge, collect and remit tax on a supply, and they turn on place of supply and the identity of the supplier rather than on whether you run a platform.

The two do touch. The directive clarifies that information communicated between member states may also be used for the assessment, administration and enforcement of VAT and other indirect taxes. DAC7 data can therefore surface a VAT problem you already had, which is a good reason to get the VAT position right first. Our [EU VAT guide for SaaS](https://dodopayments.com/blogs/eu-vat-saas-guide-2026) and the walkthrough of [VAT compliance for digital products](https://dodopayments.com/blogs/vat-compliance-digital-products) cover that side, [VAT versus sales tax](https://dodopayments.com/blogs/vat-vs-sales-tax-saas) helps if you also sell into the United States, and the [global VAT and GST guide for AI SaaS](https://dodopayments.com/blogs/global-vat-gst-ai-saas) covers multi-country subscription selling.

## Where a Merchant of Record Changes the Picture

A merchant of record changes who the legal seller is in the end-customer transaction. It does not automatically switch off DAC7. These are two different questions, and conflating them is the most common mistake in this area.

When [Dodo Payments](https://dodopayments.com) acts as merchant of record, Dodo is the seller of record to the end customer: it contracts with the buyer, collects the payment, and takes on the consumption tax registration, collection and remittance obligations for that sale. You are Dodo's supplier and receive a settlement rather than the customer's gross payment. The mechanics are set out in the [merchant of record explainer](https://dodopayments.com/blogs/what-is-a-merchant-of-record) and in more depth for [marketplaces specifically](https://dodopayments.com/blogs/merchant-of-record-marketplaces).

That changes the consumption tax posture on the end-customer sale, who holds the customer relationship for invoicing, refunds and chargebacks as described in the [legal and compliance overview of the model](https://dodopayments.com/blogs/merchant-of-record-legal-compliance), and the flow of funds you reconcile against.

What it does not automatically change:

- Whether you are a platform operator that contracts with third-party sellers to make your software available to them for a relevant activity. If you are, the DAC7 analysis still runs on your own facts.
- Whether the activities on your platform fall into the four relevant activity categories.
- Your obligation to complete due diligence by 31 December if you are in scope.

The reliable takeaway is narrower: DAC7 attaches to intermediation, and the directive expressly excludes software that only processes payments without further intervention in the relevant activity. A first-party seller using a payment stack sits in a very different position from an operator running a third-party seller marketplace, even if both use the same provider. Where you fall on that line is a facts-and-circumstances question for a tax advisor. Our comparison of [merchant of record platforms](https://dodopayments.com/blogs/best-merchant-of-record-platforms), the [pricing page](https://dodopayments.com/pricing) and the [API reference](https://docs.dodopayments.com/api-reference/introduction) cover the commercial and technical side.

## What to Do Before the Next Reporting Deadline

Work backwards from 31 January. Everything upstream of it has an earlier hard date.

1. Determine whether any activity on your platform is a relevant activity. If none of the four categories apply, document that reasoning now.
2. Confirm your nexus and pick the member state you will report in if more than one applies.
3. Add TIN, VAT number, date of birth or business registration number, and primary address to seller onboarding, then verify them.
4. Instrument quarterly consideration, fee, commission and withheld tax totals per seller, plus the financial account identifier and account holder name where different.
5. Complete due diligence by 31 December, file by 31 January, and send each seller their copy on the same date.
6. Have a tax advisor in your filing member state review the output before you submit it.

Building the seller and payout side from scratch, the [quickstart](https://docs.dodopayments.com/quickstart), [payouts documentation](https://docs.dodopayments.com/features/payouts) and [webhooks reference](https://docs.dodopayments.com/developer-resources/webhooks) get transaction-level events into your records so quarterly aggregation is a query rather than a reconstruction. Founders selling directly rather than through a marketplace may prefer our guide to [selling digital products online](https://dodopayments.com/blogs/how-to-sell-digital-products-online) and the [solopreneur tax compliance guide](https://dodopayments.com/blogs/solopreneurs-tax-compliance).

## FAQ

### What is the DAC7 reporting deadline?

Reporting platform operators must file with their competent authority no later than 31 January of the year following the calendar year in which a seller is identified as a reportable seller, and must give each reportable seller a copy of their reported information by the same date. Due diligence on sellers has to be finished earlier, by 31 December of the reportable period itself.

### Does DAC7 apply to platforms based outside the EU?

Yes. A platform with no EU tax residence, incorporation, place of management or permanent establishment is still a reporting platform operator if it facilitates a relevant activity by reportable sellers or the rental of immovable property located in a member state, unless it is a qualified non-Union platform operator reporting equivalent information elsewhere under a qualifying agreement.

### Which sellers are excluded from DAC7 reporting?

Governmental entities, entities whose stock trades regularly on an established securities market and their related entities, entities with more than 2,000 property rental activities for a single property listing, and sellers with fewer than 30 sales of goods and EUR 2,000 or less in consideration. That last exclusion applies only to sales of goods, not to personal services, transport rental or property rental.

### What penalty applies for missing a DAC7 filing?

There is no single EU-wide amount. The directive requires each member state to set penalties that are effective, proportionate and dissuasive, so the figure depends on where you file, and you should confirm it with a tax advisor in that member state.

### Does using a merchant of record remove my DAC7 obligations?

No, not automatically. A merchant of record becomes the seller to the end customer and takes on the VAT and GST obligations for that sale, but DAC7 attaches to operating a platform that connects third-party sellers with users for a relevant activity. If that describes your product, the reporting analysis still applies to you and should be reviewed with a tax advisor.
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