On May 11, 2016, the Austrian Ministry of Finance published a draft version of the EU Tax Amendment Act 2016 (EU-Abgabenänderungsgesetz 2016) and submitted it for approval. The draft bill provides for the implementation of country-by-country reporting (CbCR), as recommended by OECD BEPS Action 13 and the implementation of the Directive on automatic exchange of information with respect to advance tax rulings (Directive 2015/2376/EU) of December 8, 2015.
The new three-tier documentation structure in the draft version includes a master file, local file and CbC report. A business unit of a multinational group that is an Austrian resident must submit a master and local file if revenues exceeded 50 million euros or fee income (i.e., commissions) exceeded 5 million euros in the previous marketing year.
The purpose of the master file is to give a general overview of the company’s economic, legal, financial and tax profile. The local file should include information on business transactions of the group, such as financial transactions. The tax office may request additional documents, which are required for identifying and evaluating appropriate intra-group transfer pricing. The master and local files should be forwarded, following the date of submission of the corporate tax return, to the tax authority within 30 days of its request.
A multinational group which has a consolidated annual turnover of at least 750 million euros in the previous business year must submit a CbC report with information on the global distribution of income, tax and business activities. The report must be submitted by one of the following:
- Ultimate parent company, if established in Austria.
- Austrian-resident subsidiary on behalf of the ultimate parent company.
An Austrian-resident business unit of the group should submit the CbC report on behalf of the ultimate parent company if one of the following conditions is met:
- Ultimate parent company is not required in their state of residence to submit a CbC report.
- The state of residence of the ultimate parent company has not entered into a qualified agreement to exchange reports.
- There is a systemic failure in the country of residence of the ultimate parent company. This occurs when a qualified agreement to exchange CbC reports has been suspended or there has been a failure to transmit the reports.
The local file must be submitted no later than 12 months following the last day of the marketing year. If the taxpayer intentionally failed to file, or inaccurately reported information, then this would incur a fine of up to 80,000 euros (gross negligence would be fined up to 25,000 euros). A negligent supply of incorrect information is not a punishable offense.
Full documentation (master file, local file and CbC report) can be submitted in either German or English. The submission of annual CbC reports is due no later than 15 months following the last day of the marketing year. The first transmission of the reports is due no later than 18 months after the last day of the marketing year, which begins on or after January 1, 2016.
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