Implementation of DAC9 in Denmark: Key Implications for the Global Minimum Tax

The entry into force of the Global Minimum Tax (Pillar 2) has not only significantly impacted the architecture of international taxation, but also the need to establish robust mechanisms for reporting and exchanging information among tax administrations. In this context, the DAC9 Directive is a fundamental operational pillar within the European Union.

The recent implementation of DAC9 in Danish legislation is essential in consolidating the tax transparency framework associated with Pillar 2, with significant practical implications for multinational groups.

DAC9: A Tool at the Service of Pillar 2

DAC9 is an amendment to the Directive on Administrative Cooperation (DAC) that mainly aims to facilitate the automatic exchange of information related to the top-up tax derived from the GloBE rules of Pillar 2.

Unlike other DAC directives targeting aggressive tax planning schemes or financial income, DAC9 has an eminently operational focus: Ensuring that tax administrations have consistent, standardized, and timely information to verify the correct calculation and allocation of the global minimum tax.

Transposition of DAC9 in Denmark

Denmark has incorporated DAC9 into its domestic law through a legislative project that adapts its administrative cooperation regulations to the new information exchange requirements. This transposition has three main objectives:

1. To establish the national legal basis for the automatic exchange of information related to the global minimum tax.
2. To adopt a standardized reporting format aligned with the OECD model.
3. Enable the exchange of information both within and outside the European Union through multilateral or bilateral agreements.

Thus, Denmark positions itself as a jurisdiction entirely aligned with the international tax transparency standards outlined in Pillar 2.

The GloBE Information Return as the System’s Core

One of the most relevant aspects of DAC9 is the adoption of the GloBE Information Return (GIR) as the core reporting format. This document contains detailed information on:

• The structure of the multinational group.

• The allocation of income and results by jurisdiction.

• The calculation of the effective tax rate.

• The determination of the complementary tax, where applicable.

The GIR standardisation allows multiple jurisdictions to use the same return, reducing duplication while increasing the visibility of tax information globally.

Automatic Information Exchange and Enforcement

The implementation of DAC9 significantly strengthens the enforcement capabilities of tax administrations. Through the automatic exchange of the GIR, authorities will be able to:

• Identify jurisdictions with effective taxation below the minimum,

• Verify the correct application of GloBE rules, and

• Detect inconsistencies between reported information and other tax transparency instruments, such as the Country-by-Country Report.

This level of international coordination substantially reduces the margins of discretion and raises the compliance standards required of taxpayers.

Practical Implications for Multinational Groups

Practically, DAC9’s implementation in Denmark means multinational groups will need to:

• Prepared highly consistent and verifiable tax info,

• Ensure consistency among the GIR, financial statements, and Transfer Pricing documentation, and

• Strengthen their internal systems for collecting and validating tax data.

While DAC9 does not introduce new substantive tax obligations, it does significantly increase the risk of errors, omissions, or inconsistencies in reporting.

Conclusion

DAC9’s implementation in Denmark confirms that the Global Minimum Tax is not just an exercise in rate harmonization, but a structural change in how tax administrations cooperate, exchange information, and audit multinational groups.

In this new environment, effectively managing Pillar 2 compliance requires a comprehensive approach that includes technical expertise, international coordination, and robust tax governance. Transparency is no longer an abstract principle but has become a central operational element of the worldwide tax system.

Technical Transfer Pricing Solutions for a More Complex Global Tax Environment

At TPC Group, as a specialized Transfer Pricing firm, we provide technical and strategic advice to multinational companies to address contemporary tax compliance and Transfer Pricing documentation challenges. Our team combines regulatory expertise, sound methodological criteria, and a preventive approach to mitigate audit risks, ensure consistency across jurisdictions, and strengthen your Transfer Pricing processes in a context of greater transparency and international requirements.

Source: IBFD