The OECD has issued two further updates to its guidance on the implementation and operation of country-by-country reporting (BEPS Action 13). The existing guidance is updated to address:
· the definition of revenues;
· treatment of groups with a short accounting period; and
· treatment of income tax accrued and income tax paid.
In addition, new guidance covers the ‘appropriate use’ by tax administrations of information contained in country-by-country reports. This instructs national tax authorities not to use the information for anything other than assessing high-level transfer pricing, risks related to base erosion and profit shifting, or economic and statistical analysis. Where a tax authority fails to comply with these conditions, it will automatically have to retract its tax assessment if challenged by the company concerned.
The OECD has issued two further updates to its guidance on the implementation and operation of country-by-country reporting (BEPS Action 13). The existing guidance is updated to address:
· the definition of revenues;
· treatment of groups with a short accounting period; and
· treatment of income tax accrued and income tax paid.
In addition, new guidance covers the ‘appropriate use’ by tax administrations of information contained in country-by-country reports. This instructs national tax authorities not to use the information for anything other than assessing high-level transfer pricing, risks related to base erosion and profit shifting, or economic and statistical analysis. Where a tax authority fails to comply with these conditions, it will automatically have to retract its tax assessment if challenged by the company concerned.
