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Tax Alert: Updates on Country-by-Country Reporting requirements in Qatar

Tax Alert: Updates on Country-by-Country Reporting requ

The CbCR notification and the CbCR should be submitted within 12 months as of the last day of the reporting financial period.

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In our previous alert dated 23 December 2018 related to the Country by Country Report (“CbCR”) in Qatar, we had informed you the regarding the suspension of CbCR filing requirements for 2017 and the updated requirements of filing the notifications and CbCR for the financial year beginning on or after 1 January 2018.

On 16 June 2019 the General Tax Authority (“GTA”) in Qatar issued a circular, providing further updates and clarifications for the CbCR obligations in Qatar

Reporting period and due date

The notification and CbCR filing requirements are effective for the financial years beginning on or after 1 January 2018. The CbCR notification and the CbCR should be submitted within 12 months as of the last day of the reporting financial period.

Thus, for the financial year ending 31 December 2018, the due date will be 31 December 2019.

Entities obliged to submit CbCR

Entities meeting the following requirements are required to file the CbCR

  • To be resident in Qatar;
  • To be the Ultimate Parent Entity of a multinational enterprise (“MNE”) group; and
  • The total revenue of the MNE group is at least QAR 3 billion (approx. EUR 700 million or USD 824 million) in the preceding financial year based on consolidated financial statements of that preceding year.

Entities required to be included in the CbCR

The financial and business data of the following entities shall be covered in the CbCR

  • Separate business unit of the MNE group that is included in its consolidated financial statements for the purpose of financial reporting or that shall be included in the financial statements if the shares thereof are listed on the stock exchange;
  • A business unit that is excluded from the consolidated financial statements of the MNE group only for reasons related to its size; or
  • A permanent establishment of a separate business unit that is described in the two previous bullet points on the condition that the business unit prepares separate financial statements for that permanent establishment for regulatory or tax purposes, financial reporting purposes or internal management and supervisory purposes.

Entities not required to file CbCR

Any constituent entity resident in Qatar for tax purposes where the Ultimate Parent Entity is resident outside Qatar (non-Qatari Ultimate Parent), shall not be required to file the CbCR to the GTA until further notification, neither it will be required to submit a notification of the identity of the reporting entity or its place of residence.

CbCR content, submission method and penalties

  • CbCR should include the information described in the CbCR model in the OECD’s Action 13 Final Report
  • The notification should be submitted on the form prescribed last year
  • The CbCR should be submitted using the XML schema format as per the guidance provided by the OECD
  • The GTA will issue an announcement that will include the electronic link for the submission of the report
  • The GTA shall monitor the cases of non-compliance with the notification and CbCR filing requirements and impose the financial penalties provided for under Article 24 (8) of the Income Tax Law (which may extend up to QR 500,000).

How can we help you?

 

The CbCR reports should be prepared keeping in perspective the entire group operation, in various countries, as the GTA will automatically share the report with the authorities of the countries in which the MNE operates. Accordingly, it becomes critical for the reporting MNE to gather consistent and accurate CbCR data, analyze such data to review outliers and key trends and produce a robust CbCR with supporting narrative and assumptions.

 

We at KPMG in Qatar can help you in preparing your CbCR reporting and also reviewing and evaluating the data gathered for the group.

We welcome the opportunity to discuss your CbCR and notification filing requirements in Qatar.

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