CbC Reporting is a part of Action 13 of the Base Erosion and Profit Shifting (BEPS) initiative led by the Organization for Economic Co-operation and Development (OECD) and the Group of Twenty (G20) industrialized nations.
BEPS Action 13 requires large Multinational Groups of Entities (MNEs) to file a CbC Report
That should provide a breakdown of the Multinational Group’s global revenue, profit before tax, income tax accrued and some other indicators of economic activities for each jurisdiction in which the MNE operates.
The purpose of CbC Reporting is to eliminate any gap in information between the taxpayers and tax administrations with regards to information on where the economic value is generated within the MNE Group and whether it matches where profits are allocated, and taxes are paid on a global level.
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UAE-headquartered Groups of companies which meet the following criteria should comply with CbC Reporting legislation in the UAE:
- MNE Groups (i.e., Groups which consist of two or more enterprises that are residents for tax purposes in different jurisdictions.); and
- Have a total consolidated revenue that is equal to or more than AED 3,150,000,000 for the financial year preceding the reporting year concerned.
The UAE tax resident entity is an Ultimate Parent Entity of the MNE Group which is subject to the CbC Reporting Legislation. Based on the existing UAE laws and international tax treaties, an entity should be considered as a tax resident in the UAE if it is incorporated or created under the laws of UAE or has its place of effective management therein.
CbC Reporting requirements come into effect for financial years starting on or after January 1st, 2019. The CbC report should be filed within 12 months from the end of the reporting year of the MNE Group (e.g., With respect to the financial year commencing on January 1st, 2019 and ending by December 31st 2019, the CbC Report should be filed no later than December 31, 2020).
A CbCR notification is a form containing (i) confirmation that the notifying entity is the Ultimate Parent Entity of the MNE Group, resident in the UAE, and the UAE CbCR requirements are applicable to such MNE Group; and (ii) identification of such entity including trade license number, address, business activity and year end. A report including quantitative and qualitative information about the MNE Group. Information such as revenues, profits, employees count, business description, etc. should be reported.
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Office No. 504, Port Saeed, Al Wahda Building, Dubai, United Arab Emirates P.O. Box : 31367
Phone No : +971 4 2959958
Fax No : +971 4 2959945
Email : email@example.com
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Email : email@example.com