This year in August, the Transfer Pricing Documentation Act (TPDA) was published in the Federal Law Gazette and therefore became effective. The new documentation requirements stipulate a three-tier documentation approach, consisting of a Master File, a Local File and a Country-by-Country Report (CbCR) and apply already for financial years beginning on or after 1.1.2016. In addition, specific Notification obligations with regard to the CbCR already apply for the financial year 2016.
Who has to file a Country-by-Country Report?
If a multinational group’s consolidated group revenue in the immediately preceding fiscal year amounted to at least EUR 750 Mio, the Ultimate Parent Entity, if resident in Austria, is obliged to file a CbCR. Under certain circumstances, for example if the ultimate parent company is resident in a foreign tax jurisdiction and not required to file a CbCR, even though the consolidated group revenue meets the threshold of EUR 750 Mio, the Austrian entity could enter into the foreign parent entity’s obligation to file the report (or eventually has to enter into this obligation).
According to § 4 TPDA, each Austrian entity, that is part of a multinational group, which is obliged to file a CbCR, has to inform the tax office in charge, which entity will file the report, at the latest, until the last day of the reportable year. Until 31.12.2016, Austrian entities belonging to a group with consolidated group revenue of at least EUR 750 Mio and keeping its financial accounts on a calendar year basis, have to provide the tax authorities with the following information:
- If the Austrian entity is the Ultimate Parent Entity or if it is the Surrogate Parent Entity (and therefore obliged to file the Country-by-Country Report); or in case it is not the Reporting entity
- Which constituent entity is obliged to report and where it has its residence (precise company name and tax residency).
The procedure for notifying the tax authorities is not clear yet. Tax authorities are currently working on a guideline concerning the notifying procedure. It is hard to predict, whether there will be a module in “FinanzOnline” already for fiscal year 2016. Currently a notification via ”sonstige Anbringen” in “FinanzOnline” or by post seems to be possible.
The fact that the first notification according to § 4 TPDA has to be submitted until the end of fiscal year 2016 calls for immediate action, especially for Austrian group entities keeping its financial accounts on a calendar year basis. In a first step, it has to be determined if a CbCR has to be filed. If this is the case, it should be clarified who is obliged to file the report and the tax authorities have to be notified in time.
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