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Country by Country (CbC) Reporting for Significant Global Entities

Posted by Northadvisory on October 12, 2017

Country by country (CbC) reporting applies to income years commencing on, or after, 1 January 2016.

Significant Global Entities (SGEs) need to electronically lodge three statements (the local file, master file and CbC report) with the Australian Taxation Office (ATO). The first report is due on 31 December 2017, which may be too soon for some entities to comply with.

The good news is that the ATO may consider granting transitional exemptions for the CbC report and master file for the first year on the basis that:

• The global parent entity is not subject to CbC reporting for the income year ended 31 December 2016
• The CbC report and master file are not required to be prepared or lodged in any other tax jurisdictions outside of Australia by the time the CbC report and master file are due for lodgment (31 December 2017)
• You commit to filing the CbC report and master file for the periods after the first year
The exemption to the local file is unlikely if there are international related party dealings (IRPDs) in existence.

However if you have only low risk IRPDs (as included on the ATO exclusion list), then you should consider including the local file in the application for exemption.

Due to the short time-frame to the first reporting deadline 31 December 2017, it is recommended that you make an exemption request as early as possible to allow the ATO to make and notify you of their decision before the statutory due date.

Please contact us for more information, if you have any queries in regards to applying for reporting exemptions.

Martin van der Saag
Director
T: 02 9984 7774
E: martinv@northadvisory.com.au

Judy She
Senior Accountant
T: 02 9984 7774
E: judys@northadvisory.com.au