Russia signs agreement on sharing country reporting on international groups of cos
MOSCOW. Jan 27 (Interfax) - Russia's Federal Tax Service (FTS) signed the Multilateral Competent Authority Agreement on the automatic exchange of country-by-country reporting about members of major international groups of companies on January 26, the FTS said in a press release.
The agreement was signed in Paris on the sidelines of a meeting of the Inclusive Framework on the Action Plan on Base Erosion and Profit Shifting (BEPS), which has been approved by the leaders and governments of the G20.
A country report is a formalized document that reflects certain financial, tax and operational indicators of international groups of companies in nations or territories where the members of such groups do business.
Reports are supposed to be generated and provided on the biggest international groups of companies, the consolidated revenues of which exceed 750 million euros (about 50 billion rubles) in a financial year. A country report is submitted by the group's parent company to the tax authority of the country of which it is a resident. This tax authority, in turn, is supposed to share such reports with the tax authorities of other countries in which other group members are located.
More than 50 countries or territories have now adopted legislation to implement automatic exchange of country-by-country reporting and joined the multilateral agreement.
Russia's accession to the multilateral agreement and the Convention on Mutual Administrative Assistance in Tax Matters that went into effect on July 1, 2015 create an international legal foundation that will enable the FTS to exchange country reports and use the information they contain for pre-audit analysis, the press release said.
Russian taxpayers will be able to present country reports in a centralized manner, including in regard to group members that are tax residents of foreign countries (territories), without risk of secondary discovery.
In May 2016, the FTS signed the MCAA on automatic exchange of information at an OECD tax administration forum in Beijing.
The first automatic exchanges of information for Russia will take place in 2018 and will apply to information for 2017, according to a schedule announced in a report from OECD Secretary-General Angel Gurria last April. The exchanges will be made electronically via the system that will be built on the OECD platform. The exchanges will include information about any income received on funds in accounts, balances on accounts and payments made using an account. At present, information is shared primarily upon request.