I would report this sentence. Firstly, I don't think "Er ist darüber hinaus" is a valid German sentence. At least, I would consider it uncommon.
You could say "er ist darüber hinaus sehr intelligent", the "darüber hinaus" here meaning "moreover" or "additionally" ("He is additionally very intelligent"). In this case you could not use the "darüber hinaus" that isolated. Or you could say "Er ist darüber hinweg.", meaning "He is over it" or "He has coped with it".
But I personally don't think I would ever say "Er ist darüber hinaus." in the sense that "he is beyond a level" or something like that.
Secondly, even if "Er ist darüber hinaus" somehow is a valid expression that I just happen not to know, "it is beyond" certainly would not be the right translation... I mean, where does the "it" come from?
"It is beyond" can mean different things in German, depending on its context. It is actually hard to translate it like that. So in context it can mean for example:
"It is beyond me" = "Ich verstehe es einfach nicht"
"It is beyond our means" = "Das übersteigt unsere Mittel"
"It is beyond doubt" = "Es ist ohne Zweifel"
"Where is this place that we go to when we die? - It is beyond" = "Wo liegt dieser Ort, zu dem wir kommen, wenn wir sterben? - Er liegt im Jenseits"
"It is beyond the border" = "Es ist jenseits der Grenze"
I think that as a free foreign language learning tool, started by an American university, Duolingo does a good job; occasionally it produces sentences like this which appear out of context but make one think (or should do), and look up and research stuff, which is the essence of learning I believe.
Or... pay a fortune to Berlitz for one on one, or not. Mysteries are to be solved. My heart is with Duolingo for what it is worth.
Absolutely, Duolingo does a very good job for a free learning tool and I actually love the quirky sentences it sometimes produces ;) But reporting a sentence that is just not really right is exactly the thing to do to help making Duolingo better, because it is free. That way everyone can contribute a little.
Literally: "He is beyond it", e.g. beyond the age when he liked playing with model cars or took his teddy bear to bed with him; or he was put in an A2 level language class but he can (now?) speak the language better than that (and should be assigned to a different class): he is beyond that level.
(Not "He is over the fact that his girlfriend left him", that would be "Er ist darüber hinweg.")
Or maybe he drove over a cliff, he was supposed to stop at the warning sign, but "er ist darüber hinaus[gefahren]"... I don't know :)
It's one of those sentences that I feel want some context and sometimes leave me, as a native speaker, wondering in which context you would actually, naturally use that exact wording Duo offers. (And the longer I ponder, the more my own language seems to confuse my brain.)
"It is beyond" (what Duo suggests) - I'd translate it as "Es ist jenseits dessen / davon", e.g. "Jupiter is beyond the asteroid belt / Jupiter ist jenseits des Asteroidengürtels", "freedom lies beyond the final exams / jenseits der Prüfungen ist Freiheit". Or: "It is beyond me" = e.g. "Es ist mir zu hoch" (I'm too stupid to understand), for other meanings and translations see https://dict.leo.org/forum/viewWrongentry.php?idThread=912945=6=de=ende