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BEPS Country-by-Country Reporting: The Practical Impact for Corporate Tax Departments

by Bill Brennan, M.S. Tax., CPA | Jun 08, 2015   ()

On Sept. 16, 2014, the Organisation for Economic Co-operation and Development (OECD) released its first set of deliverables regarding its Action Plan on Base Erosion and Profit Shifting (BEPS). Included was the highly anticipated final version of its recommended Action 13 country-by-country template, which multinational companies will use to report their income, taxes paid, and other indicators of economic activity. The template requires multinational companies to report annually and for each tax jurisdiction in which they do business the amount of revenue, profit before income tax, and income taxes paid and accrued. It also requires them to report their total employment, capital, retained earnings, and tangible assets in each tax jurisdiction. Finally, multinational companies must identify each entity within the group doing business in a particular tax jurisdiction and describe the business activities of each.

For the first time, taxing authorities throughout the world will be able to ascertain how multinational companies allocate their income and tax payments to a specific country, and other countries as well. The template will also serve as an essential tool for taxing authorities to identify and select companies to be audited.

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Source: The Tax Adviser
Source: The Tax Adviser

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