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Canada: ready more than ever for CbC reporting
Taxand Canada explores the recently announced administrative practices in respect of the country-by-country reporting in Canada.
On 21 October 2016, federal Finance Minister, Bill Morneau, tabled a notice of ways and means motion that implemented country-by-country reporting into Canadian tax legislation. The measures implemented into Canadian law were consistent with the minimum standard recommended in Action 13 of the OECD’s base erosion and profit shifting initiative.
The Canadian legislation requires multinational enterprises with total annual consolidated group revenue of €750 million or more to file country-by-country reports. The filing deadline for a country-by-country report depends on the fiscal year end of the entity. A country-by-country report is required to be filed in Canada for fiscal years of multinational enterprise groups beginning on or after 1 January 2016.
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Recently, the CRA released the country-by-country reporting form and guidance on the implementation of country-by-country reporting. Certain approaches advocated for by the CRA differ from those recommended by the OECD. Circumstances could arise where Canadian practices differ from those of the OECD. It is expected that in these situations the CRA will likely take a position that is aligned with Canadian practices rather than those of the OECD. As a result, it is extremely important that multinationals with Canadian operations are mindful of the unique aspects of Canadian country-by-country reporting requirements.