South Africa, Jersey, and Belgium have indicated their readiness, amongst a few other territories, to extend the due date for country-by-country (CbC) reports under the new frameworks being introduced under Action 13 of the OECD’s base erosion and profit shifting Action Plan.
The report is one element of a new three-tier standardized approach to transfer pricing documentation proposed under Action 13 of the OECD’s Base Erosion Profit Sharing (BEPS) project.
Under the OECD framework, Multinational Enterprises (MNEs) are required to provide aggregate information annually for each jurisdiction where they do business, relating to the global allocation of income and taxes paid, together with other indicators of the location of economic activity within the MNE Group, in the country-by-country report and a master and local file. Such documentation covers also information about which entities do business in a particular jurisdiction and the business activities each entity engages in.
A report by Tax-News.com indicated that South African Revenue Service on December 1 announced that the deadline for fiscal years commencing before March 1, 2016, had been brought forward to February 28, 2018 while Belgium has extended its end-of-year deadline for the filing of the three reports to March 31, 2018. This is even as Jersey extended its deadline by one month, to January 31, 2018.
The BEPS Action 13 report (Transfer Pricing Documentation and Country-by-Country Reporting) provides a template for MNEs to report annually and for each tax jurisdiction in which they do business the information set out therein. This report is called the Country-by-Country (CbC) Report.
To facilitate the implementation of the CbC Reporting standard, the BEPS Action 13 report includes, a CbC Reporting Implementation Package which consists of two components, namely model legislation which could be used by countries to require the ultimate parent entity of an MNE group to file the CbC Report in its jurisdiction of residence including backup filing requirements and, three model Competent Authority Agreements that could be used to facilitate implementation of the exchange of CbC Reports
The implementation of the exchange of CbC reports are based on the Multilateral Convention on Administrative Assistance in Tax Matters; Bilateral tax conventions; and Tax Information Exchange Agreements (TIEAs).