Large multinational groups are obliged to disclose detailed information on revenue, tax, assets, activities, etc, of their subsidiaries and other establishments in each country the in the context of a concerted international effort to combat the transfer of profits in countries with favorable tax regimes.
In addition to the well-known Transfer Pricing Documentation, multinational groups with total consolidated revenues of over € 750,000,000 are required to submit the Country-by-Country report on the basis of the agreed OECD guidelines.
The Country Report is submitted by the Ultimate Parent Entity of the Group, the company of the multinational Group, which is required to prepare Consolidated Financial Statements in the country of its tax residence. The Report should be submitted within 12 months of the last day of the tax year to which it relates. The first Country Report is required for tax years beginning on or after 1 January 2016.
Based on the above, the Greek parent company of a multinational group, which had consolidated revenue of more than EUR 750,000,000 in 2015, has to submit the Country Report for the fiscal year ended 31/12/2016, up to 31/12/2017.
If a report is not submitted, a fine of 10,000 euros is imposed, and a fine of 5,000 euros is imposed in case of delayed submission or submission of an inaccurate report.
Content of the Country Report
The Country Report identifies all Component-Entities, all of which are subsidiaries, permanent establishments, etc, of the Group operating in each country.
The countries in which the Group's companies have their tax residence are listed on an annual basis, as do the amount of each company's income, earnings before income tax, income tax, number of employees, share capital, accumulated profits, tangible assets, etc.
Notification of the Report
The authority in each country receiving the Report notifies by automatic exchange all States where the companies or permanent establishments of the Group are resident or taxed.
The notification should be made within 15 months of the last day of the tax year to which the Report refers. Exceptionally, the first Country Report is notified within 18 months. Therefore, for the fiscal year ending on 31/12/2016, the first report should be notified by 30/6/2018.
Submission of data by Greek subsidiaries
The Greek subsidiaries, as well as the branches of obliged multinational groups, are required to inform the Greek tax authorities about the identity and tax residence of the group company that is required to submit the Report by Country.
The relevant information must be provided by the last day of the tax year to which the Report refers. Specifically for the first year of application, this deadline is extended until the last day of submission of the Country Reports (i.e. for the fiscal year ending on 31/12/2016, the deadline for submission expires on 31/12/2017).
The aim of the tax authorities is to assess the risks in relation to intra-group transaction prices and the erosion of the tax base. Intra-group price corrections are not based on the information exchanged with the Country Report. However, they can be used as a basis for further inquiries into the Group's intra-group transactions or other tax issues.
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Posted on Sunday newspaper Kathimerini, 06/08/2017