UK country-by-country reporting

Produced by Tolley

The following Corporation Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:

  • UK country-by-country reporting
  • What is country-by-country reporting?
  • The role of the Organisation for Economic Co-operation and Development (OECD)
  • Exchange of CbC reports
  • The UK legislation
  • Key definitions used for country-by-country reporting
  • The country-by-country reporting threshold
  • Period to which the CbC report relates
  • Which entity must file the report?
  • Ultimate parent entity filing obligation
  • More...

UK country-by-country reporting

What is country-by-country reporting?

Country-by-country (CbC) reporting essentially requires large multinational enterprises (MNEs) to provide an annual return that breaks down the key elements of their activities among the jurisdictions in which they operate.

The role of the Organisation for Economic Co-operation and Development (OECD)

MNEs are under increasing pressure to operate in a fair and transparent way, with particular regard to the payment of taxes and making a fair contribution to public finances. Meanwhile, governments across the globe are under pressure to reduce public deficits, generate higher tax revenues and tackle international tax avoidance. In response to these issues, the OECD has developed a range of proposals as part of the wider base erosion and profit shifting (BEPS) project. The final package of recommendations was published by the OECD on 5 October 2015.

CbC reporting is one of the areas covered by these proposals and the detailed recommendations are set out in the final report on Action 13: Transfer Pricing Documentation and Country-by-Country Reporting.

Certain MNEs are required to provide the relevant tax authorities with a report containing high-level details of the following:

  1. territories in which they have carried out economic activity

  2. the quantum of revenue and profits generated

  3. the amount of tax paid

The OECD has developed a model CbC reporting template which is included in the final report on Action 13 (see Annex III to Chapter V).

As explained further below, the information contained in the CbC report may be shared with other tax authorities. Presenting the information in a standardised format across all jurisdictions will help to ensure consistency and allow tax authorities to assess where the greatest risks of avoidance lie and to focus resources on these areas.

The OECD guidance on the implementation of CbC reporting provides further information which is useful to those preparing the reports. The guidance has been divided into four topic areas as follows:

  1. the definition of items reported in the template for the CbC report

  2. the entities to be

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