Country-by-Country Reporting has been implemented as one of the measures for projects in connection with the automatic and international exchange of tax information.
Before submitting a country-by-country report, prior notification must be submitted to the Luxembourg Inland Revenue (Administration des contributions directes – ACD), indicating the businesses which must submit a country-by-country report on behalf of the multinational enterprise group (MNE group).
The businesses required to submit a country-by-country report (i.e. the reporting businesses) must then send that country-by-country report to the ACD.
Who is concerned
Each constituent entity in an MNE group established in Luxembourg for tax purposes is required to submit a notification to the ACD.
Each reporting entity in an MNE group established in Luxembourg for tax purposes must submit the country-by-country report to the ACD.
MNE groups exempted from the obligation to file country-by-country reports must designate a Group whose total consolidated turnover is less than 750 million Euros during the tax year immediately preceding that for which the report is being made.
The notifications must be submitted no later than the last day of the reporting fiscal year for the MNE group.
The country-by-country reports must be submitted no later than 12 months after the final day of the reporting fiscal year for the MNE group.
The first reporting fiscal year of the MNE group is the year beginning on 1 January 2016 or after that date.
How to proceed
Submitting the notification
Notifications are to be submitted to the Luxembourg Inland Revenue via the online assistant.
Information to be included in the notification
The notification should provide the Luxembourg Inland Revenue with all the information it requires to identify the reporting entity and verify the submission of the country-by-country report.
In particular, this information should include:
- details on the role of the constituent entity submitting the notification;
- details on the identity and fiscal residence of the reporting entity submitting the country-by-country report.
Submitting the country-by-country report
The country-by-country reports are to be submitted to the Luxembourg Inland Revenue via the online assistant.
The various fields in the assistant can be automatically completed through the import of a structured XML file.
Information to be included in the country-by-country report
Country-by-country reports, which must be submitted in the prescribed form, should contain the following information on the MNE group:
- aggregate details on:
- annual turnover;
- profit (or loss) before tax;
- tax paid on the profits;
- tax due on the profits;
- capital stock;
- undistributed profits;
- number of employees;
- tangible assets, excluding liquid assets or similar, for each of the jurisdictions in which the MNE group operates;
- the identity of each constituent entity in the MNE group, the jurisdiction of tax residence of each constituent entity and, if it is different to the jurisdiction of tax residence, the jurisdiction under whose laws that constituent entity is organised, and the nature of its main commercial activity or activities.
Further information or explanations, if needed, must be provided to facilitate the understanding of the data specified in the above 2 points.