Landenrapportage
Country-by-Country Reporting
Country-by-Country Reporting (CbCR) is a key transparency measure under BEPS Action 13, requiring large multinational groups to provide tax authorities with a jurisdiction-by-jurisdiction breakdown of income, taxes, and economic activity.
BEPS Action 13
BEPS Action 13 introduced a standardized three-tiered approach to transfer pricing documentation, designed to give tax authorities the information needed to assess transfer pricing risks and determine where audit resources should be allocated.
Master File
A high-level overview of the multinational group's global business operations, transfer pricing policies, and allocation of income and economic activity.
Local File
Detailed information on material intercompany transactions of each local entity, including comparability analysis and documentation supporting arm's length pricing.
CbC Report
A jurisdiction-by-jurisdiction report of key financial and operational data, filed by the ultimate parent entity and exchanged between tax authorities.
Filing Thresholds
CbCR obligations apply to multinational enterprise (MNE) groups with consolidated group revenue of at least EUR 750 million (or the equivalent in local currency) in the preceding fiscal year.
The threshold is set intentionally high to limit the compliance burden to the largest multinationals. However, some jurisdictions have adopted lower thresholds or expanded documentation requirements for smaller groups.
Report Contents
The CbC Report requires the following information for each jurisdiction in which the MNE group operates:
Revenue
Total revenue, split between related-party and unrelated-party transactions.
Profit / Loss
Pre-tax profit or loss before income tax expense.
Tax
Income tax paid (on a cash basis) and income tax accrued for the current year.
Economic Indicators
Number of employees, stated capital, retained earnings, and tangible assets (other than cash and cash equivalents).
Surrogate Filing
Where the ultimate parent entity is resident in a jurisdiction that does not require CbCR filing or does not have exchange agreements in place, a surrogate parent entity may file the report on behalf of the group.
If no surrogate is appointed, local filing obligations may arise in each jurisdiction where the group has constituent entities, leading to potential multiple filings of the same report.
Pillar 2 Safe Harbour
CbCR data plays a direct role in the Pillar 2 transitional safe harbour provisions. MNE groups can use qualified CbCR data to demonstrate that their effective tax rate in a jurisdiction meets the 15% minimum, potentially avoiding the need for a full GloBE (Global Anti-Base Erosion) computation.
The transitional CbCR safe harbour applies for fiscal years beginning on or before 31 December 2026 (and ending before 30 June 2028). Ensuring the accuracy and completeness of CbCR data is therefore critical for Pillar 2 compliance.
Data quality
CbCR data is exchanged between tax authorities automatically — ensure accuracy as inconsistencies may trigger risk assessments.