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OECD: Guidance on implementation of country-by-country reporting

OECD: Implementation of country-by-country reporting

The Organisation for Economic Cooperation and Development (OECD) today announced the release of guidance on the implementation of country-by-country (CbC) reporting.


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The OECD’s Guidance on the implementation of country-by-country (CbC) reporting [PDF 385 KB] released today sets out:

  • Transitional filing options for multinational entities (MNEs) that voluntarily file in the “parent jurisdiction”
  • Guidance on the application of CbC reporting to investment funds
  • Guidance on the application of CbC reporting to partnerships
  • The impact of exchange rate fluctuations on the €750 million filing threshold for MNE groups


The OECD’s base erosion and profit shifting (BEPS) project sets out 15 key actions to reform the international tax framework and to provide that profits are reported where economic activities are carried out and value created. One of the main features is the adoption of country-by-country (CbC) reporting, as set out in the BEPS recommendations on Action 13, “Transfer pricing documentation and country-by-country reporting.”  Under CbC reporting, MNEs will be required to provide aggregate information annually, in 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. CbC reporting will also cover information about which entities do business in a particular jurisdiction and the business activities each entity engages in.

Following the endorsement of the BEPS package in November 2015, the focus has shifted to consistent implementation, including of the new transfer pricing reporting standards developed under Action 13 of the BEPS project. 

KPMG observation

The OECD guidance on “parent surrogate filing” (i.e., voluntary filing for 2016 by the parent entity) could greatly simplify reporting for 2016 by U.S. headquartered multinationals.  If all the conditions are met and other countries agree, U.S. multinationals could file voluntarily with the IRS for 2016, and if the IRS exchanges that information with the relevant jurisdictions, that would satisfy the reporting requirements in those jurisdictions.  The remaining hurdle is determining that there are Competent Authority Agreements in place with each jurisdiction to exchange the reports, along with a legal basis for the exchange (i.e., a treaty or tax information exchange agreement).


For more information, contact a tax professional with KPMG’s Washington National Tax:

Michael Plowgian | +1 202 533-5006 |

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