CbC reporting implementation package
On 8 June 2015, the OECD, as part of the G20/OECD work on the action plan to address base erosion and profit shifting (BEPS), released the Action 13: Country-by Country Reporting Implementation Package.
This follows the two reports previously issued by the OECD, being:
i. the agreement of a three-tier global standard for transfer pricing documentation, including a common template for county-by-country (CbC) information to be reported to the tax authorities (released in September 2014); and
ii. implementation guidance in relation to the CbC report, including the timing of introduction, application to “large” businesses and filing mechanisms (released in February 2015).
The implementation package outlines model legislation that governments can use to adopt the new rules, as well as competent authority agreements to implement the sharing mechanisms for the CbC report.
The Australian Government announced in the 2015-16 Budget that it will implement the OECD recommendations on Action 13 with effect from 1 January 2016.
Groups who will be required to file CbC reports should determine whether they have the systems and processes in place to capture the required information and the potential impacts on current transfer pricing policies and processes.