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Austrian Government Submits Draft Legislation for CbC Reporting and Exchange of Tax Rulings — Orbitax Tax News & Alerts

On 10 May 2016, the Austrian Ministry of Finance submitted a draft version of the EU Tax Amendment Act 2016 (205 / ME) to parliament for review. The legislation provides for the implementation of the three-tiered transfer pricing documentation requirements developed under Action 13 of the OECD BEPS Project, as well as for the exchange of tax rulings as developed under Action 5 and required under amended Directive 2011/16/EU on administrative cooperation in the field of taxation ({News-2015-12-10/A/2- previous coverage}).

Transfer Pricing Documentation

The draft legislation includes that MNE groups operating in Austria will be required to submit a Country-by-Country (CbC) report when consolidated group revenue in the previous year meets the reporting threshold of EUR 750 million. The reporting requirements will apply for fiscal years beginning on or after 1 January 2016, with the CbC report due within 12 months following the end of the year concerned.

The filing obligation is to be met by the ultimate parent company of a group if resident in Austria, or a constituent entity of the group resident in Austria if the report is not available to the Austrian tax authorities through exchange with the parent's jurisdiction of residence. The content of the CbC report is in line with the guidelines developed as part of Action 13, and failure to file or filing an incorrect report will be subject to penalties of up to EUR 80,000.

The draft legislation also includes Master and Local file documentation requirements for Austria group members with revenue exceeding EUR 50 million in the previous year or intra-group commission income exceeding EUR 5 million in the previous year. In addition, regardless of meeting the thresholds, a Master file must be made available to the Austrian tax authorities if prepared by a group member in another jurisdiction. When required, the Master and Local file must be submitted within 30 days of request.

Click the following link for the Tax Amendment Act 2016 (205 / ME) page on the Austrian parliament website (German language). Additional details will be published when the legislation is finalized and adopted.