CbCR Reporting Requirements: Thresholds, Deadlines, and Penalties

Country-by-country reporting (CbCR) requires any multinational enterprise group with consolidated annual revenue of at least €750 million to file a single report showing how income, taxes, employees, and assets are distributed across every jurisdiction where the group operates. The obligation comes from the OECD’s BEPS Action 13 framework and has been written into domestic law in more than 120 jurisdictions.¹ The report is filed once, by the group’s top parent, and shared automatically with the tax authorities of the other jurisdictions where the group has entities.²

Does Your Group Have to File

The test is whether total consolidated group revenue in the preceding fiscal year hits or exceeds €750 million.² Each jurisdiction converts that figure into local currency using January 2015 exchange rates, and the converted amount is then fixed. There is no adjustment for later currency movement.³ In the United States the equivalent threshold is $850 million, reflecting the euro rate when the U.S. rule was finalized.⁴

Revenue for the threshold means everything that would show up as revenue in the group’s consolidated financial statements, including extraordinary income and investment gains where the applicable accounting rules pull them in.⁵ Below the threshold, no CbC report is due.

Who Files and for What Period

The filing obligation sits with the Ultimate Parent Entity, meaning the top-level entity that controls the group and is not itself controlled by another group entity. The UPE files one report in its own jurisdiction of tax residence, covering every constituent entity worldwide.

A constituent entity is any separate business unit included in the group’s consolidated financial statements, plus permanent establishments and entities left out of consolidation only because they are too small to be material. All of them get reported, regardless of size.

The reporting period is the UPE’s fiscal year. If the UPE closes its books on March 31, every subsidiary is reported on that same twelve-month window even if the subsidiary’s own accounts run to a different date.

What the Report Contains

The CbC report has three parts: two structured tables of numbers and a narrative section for context.⁶

Table 1: Jurisdictional Financials

For each jurisdiction where the group has activity, Table 1 aggregates the following, all in the UPE’s functional currency:

Revenue from unrelated parties
Revenue from related parties
Profit or loss before income tax
Income tax paid (cash basis, including withholding taxes paid by other group entities on the jurisdiction’s behalf)
Income tax accrued in the current year
Stated capital
Accumulated earnings
Number of employees, on an average full-time-equivalent basis
Tangible assets other than cash and cash equivalents, at net book value⁷

The split between related-party and unrelated-party revenue lets authorities see how much of the reported activity in a jurisdiction is intra-group. The gap between cash tax paid and accrued tax expense often shows timing differences or unusually low effective rates. Employee and tangible-asset figures answer the substance question: does the profit booked here match the people and things actually located here?

Table 2: Entity List

Table 2 names every constituent entity, its jurisdiction of tax residence, and its jurisdiction of organization or incorporation if that is different (as with certain holding companies or hybrid structures). Each entity is tagged with one or more business activities from a fixed OECD list covering research and development, IP holding, procurement, manufacturing, sales and distribution, administrative services, services to unrelated parties, group finance, regulated financial services, insurance, equity holding, dormant status, and a residual “other” category with a written description.⁸

Table 3: Narrative

The third section is a short written explanation. Groups typically use it to flag changes in accounting method, explain unusual intercompany transactions, note why a jurisdiction is in a loss position, or clarify how items like contractor headcount were treated. Answering the obvious follow-up questions here can head off audit inquiries later.

Filing Deadlines

Under the OECD model rules, the CbC report is due no later than 12 months after the last day of the group’s reporting fiscal year.⁶ A December 31 year-end means a December 31 deadline the following year. Most jurisdictions follow that timeline.

The United States handles the deadline differently. U.S.-parented groups file Form 8975 as an attachment to the UPE’s annual income tax return, and it must be filed with that return, including any extensions. It cannot be filed on its own. For a calendar-year corporation on extension, the effective CbCR deadline can run to October 15.⁹

Once filed, the report is exchanged automatically with other jurisdictions, primarily through the Multilateral Competent Authority Agreement on the Exchange of Country-by-Country Reports. That agreement sets a 15-month outer limit for transmitting the report to receiving jurisdictions after the group’s fiscal year-end, giving the filing jurisdiction roughly three months to process and send it on.¹⁰ Exchange only happens between jurisdictions that have both signed the agreement and activated a bilateral exchange relationship.

When Local Filing Kicks In

The single-filing-at-the-top approach breaks down in three situations, any of which can push the filing obligation down to a local constituent entity:

The UPE’s home jurisdiction has not enacted CbC reporting.
The UPE’s jurisdiction has the rule but no active exchange relationship with the local jurisdiction that needs the data.
The UPE’s jurisdiction has both the rule and the agreement but is systemically failing to exchange, or has suspended exchange outside the terms of the agreement.³

When any of these applies, the local entity may be required to file the full group CbC report with its own tax authority. To avoid duplicative filings around the world, the group can designate a Surrogate Parent Entity in a different jurisdiction to file on behalf of the whole group. The surrogate’s jurisdiction must itself impose CbC filing and have qualifying exchange relationships with the jurisdictions that need the report; if those conditions are met, the surrogate’s single filing satisfies the local obligations that would otherwise fall on multiple constituent entities.⁶

Notification Requirements

Most jurisdictions require each constituent entity in the group to tell its local tax authority who is filing the CbC report and in what capacity (UPE, surrogate, or local filer). The OECD model rules do not fix a single universal notification deadline. Some jurisdictions tie it to the end of the reporting fiscal year; others align it with the income tax return filing date.³ Missing the notification can trigger penalties even when the CbC report itself has been filed correctly and on time elsewhere.

Penalties

Penalty design is left to individual jurisdictions, so exposure varies. In the United States, failure to file Form 8975 falls under IRC Section 6038(b). The base penalty is $10,000 per annual reporting period for which the filing is missing. If the failure continues more than 90 days after the IRS mails a notice, an additional $10,000 accrues for each 30-day period (or fraction of one) of continued noncompliance, capped at $50,000 in additional penalty.¹¹ Total exposure for a single missed U.S. report can reach $60,000, before any wider audit consequences. Other jurisdictions set their own amounts, and some have gone significantly higher. Notification failures carry their own penalties in many countries.

A Boundary Worth Noting on Use of the Data

The CbC report supports high-level transfer pricing risk assessment, evaluation of other profit-shifting risks, and economic or statistical analysis. Tax authorities have committed not to use CbC data on its own to propose income adjustments through a formulary apportionment of the group’s profits.¹² Full transfer pricing analysis of specific transactions is still required before any adjustment.

Overlapping Obligations to Watch

EU Public CbCR

The European Union introduced a parallel, public disclosure regime under Directive 2021/2101. Groups with consolidated revenue over €750 million for two consecutive financial years must publish income tax information broken down by EU member state and by jurisdictions on the EU’s non-cooperative lists. It applies to EU-headquartered groups, large EU subsidiaries of non-EU parents, and qualifying EU branches of non-EU companies. Member states were required to bring it into force for financial years starting on or after June 22, 2024, so for calendar-year groups the first public reports cover 2025.¹³ The data set overlaps with the confidential CbC report but is accessible to anyone, not just tax authorities.

Pillar Two Transitional Safe Harbour

Under the OECD’s Pillar Two 15% global minimum tax framework, an MNE group can use its existing CbC report data to demonstrate that a jurisdiction’s effective tax rate already clears the threshold, avoiding the full GloBE calculation for that jurisdiction under the Transitional CbCR Safe Harbour.¹⁴ The OECD has extended this transitional safe harbour through at least 2026. The practical effect is that the accuracy of CbC data now feeds directly into whether a group can avoid the more complex minimum-tax computation in a given jurisdiction.

1
OECD. Country-by-Country Reporting – Compilation of 2025 Peer Review Reports
2
OECD. Country-by-Country Reporting for Tax Purposes
3
Organisation for Economic Co-operation and Development. Guidance on the Implementation of Country-by-Country Reporting – BEPS Action 13
4
Internal Revenue Service. About Form 8975, Country by Country Report
5
OECD. Guidance on the Implementation of Country-by-Country Reporting – Compilation of Approaches Adopted by Jurisdictions
6
Organisation for Economic Co-operation and Development. Action 13 – Country-by-Country Reporting Implementation Package
7
Internal Revenue Service. Schedule A Form 8975
8
Organisation for Economic Co-operation and Development. Transfer Pricing Documentation and Country-by-Country Reporting – Action 13 – 2015 Final Report
9
Internal Revenue Service. Instructions for Form 8975 and Schedule A
10
OECD. Multilateral Competent Authority Agreement on the Exchange of Country-by-Country Reports
11
Office of the Law Revision Counsel. 26 USC 6038 – Information Reporting With Respect to Certain Foreign Entities
12
Organisation for Economic Co-operation and Development. Guidance on the Appropriate Use of Information Contained in CbC Reports
13
EUR-Lex. Directive 2021/2101
14
OECD. Global Anti-Base Erosion Model Rules – Pillar Two