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Portugal

25 April 2017

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Legislation for EU Tax Ruling and CbC Report Exchange Submitted to Portuguese Parliament

On 20 April 2017, draft legislation (Law No. 73/XIII) was submitted to the Portuguese parliament to transpose into domestic law the amendments made to the EU administrative cooperation Directive (2011/16/EU) concerning the exchange of information on cross border tax rulings and advance pricing agreements (APAs) as per Council Directive (EU) 2016/2376 and of Country-by-Country (CbC) reports as per Council Directive (EU) 2016/881. The draft legislation also includes amendments for the exchange of financial account information.

With regard to tax rulings and APAs, information will generally be exchanged for rulings and APAs issued from 1 January 2017, as well as:

  • Rulings and APAs issued, amended, or renewed between 1 January 2012 and 31 December 2013, if still valid on 1 January 2014; and
  • Rulings and APAs issued, amended, or renewed between 1 January 2014 and 31 December 2016.

With regard to CbC reports, Portugal already has requirements in place that are generally in line with the EU requirements, although amendments are needed to adjust certain wording and other aspects. This includes that if a non-parent constituent entity is required to file locally, such entity must request that all required information for the CbC report be provided by the foreign ultimate parent. If the ultimate parent has not provided all required information, a CbC report must still be filed using available information and notification of the parent entity's refusal to provide the information must be made to the tax authority.

In addition, the draft legislation introduces a transitional provision in accordance with EU rules, which provides that the secondary local filing requirements for non-parent entities will apply for fiscal years beginning on or after 1 January 2017. For ultimate and surrogate parents resident in Portugal, the requirements apply from 1 January 2016 as currently required.

Click the following link for draft Law No. 73/XIII (Portuguese language).The legislation must be approved by parliament, and will enter into force the day after it is published.

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