Wednesday, 18 January 2017

Brazil: implementation of CbC reporting — regulation published

Normative Instruction 1,681/2016, published in the Official Gazette of 29 December 2016, regulates the implementation of the obligation to provide information through an annual country-by-country (CbC) report.
Normative Instruction 1,681/2016 introduces the following:

  • All controlling legal entities resident in Brazil are obliged to submit the annual CbC reporting
  • Resident legal entities with total consolidated income of the multinational group not exceeding, in the preceding year, the following thresholds are exempt from such obligation:
  • BRL2.26 billion, provided that the final controlling company is resident in Brazil for tax purposes
  • €750 million or the equivalent amount in the local currency of the jurisdiction in which the final controlling company is resident for tax purposes, if the final controlling company is not resident in Brazil
  • The information is presented annually through the standard digital accounts normally submitted by legal entities, the Fiscal Accounting Report(Escrituração Contábil Fiscal (ECF)). The first report relates to the 2016 fiscal year.
Source: EY