UK: Updated HMRC guidance for filing CbC reports | KPMG | GLOBAL

UK: Updated HMRC guidance for filing country-by-country reports

UK: Updated HMRC guidance for filing CbC reports

HM Revenue & Customs (HMRC) on 15 August 2017 released guidance confirming the format and method of filing country-by-country (CbC) reports that are due in the UK.

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CbC reports must be prepared using the XML schema format provided by the OECD, but there is a UK procedure that must be followed. Accordingly, CbC reports due to be filed in the UK must be filed using the HMRC reporting service, which is expected to be available soon. Only reports in this approved format will be accepted for electronic filing by HMRC.

Along with confirming the schema format required for CbC reports being filed in the UK, guidance on preparing and filing the reports was published, covering recent updates to the HMRC International Exchange of Information Manual including:

  • Groups that must complete a report: The guidance covers which groups must complete a report, and which entity is to file it. It also refers to the updated manual that covers the tests for entities and multinational entity groups that are within the scope of CbC reporting. The manual includes the definition of the “ultimate parent entity” (the same meaning as the OECD model except that it must be tax resident in the UK if it is a company, or it must be formed or organised under UK law if it is a partnership).
  • Notifying HMRC: Details of how to notify HMRC about a CbC filing requirement, along with email and postal addresses of where to make the notification, have been included in the guidance. Taxpayers will have until the later of 1 September 2017 or the end of the reportable period to do this.
  • Exceptions to the filing obligation: A UK entity may not be required to file a CbC report if it can apply one of two exceptions. If it plans to apply one of the exceptions, it must notify HMRC by the later of 1 September 2017 or the end of the reportable period.

Note that the XML file will require a tax identification number (TIN) for each “constituent entity” in the CbC report; thus, groups need to consider steps to start to collate this information now.

 

Read an August 2017 report prepared by the KPMG member firm in the UK

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