The German Ministry of Finance has published a notice on the current issue of the Newsletter of the Federal Central Tax Office, which addresses changes to Country-by-Country (CbC) reporting due to the Annual Tax Law (Act) 2020 (Jahressteuergesetz - JStG 2020).

As a result of the Annual Tax Law 2020, the words "based on the consolidated financial statements" have been deleted from Section 138a, Paragraph 2, Number 1 of the Tax Code. This deletion makes it clear that in addition to the consolidated financial statements, other data sources, such as internal accounting, may be used to create the CbC report. As a result, all business units must be included in the CbC report. The amendments apply to all open cases. Specifically, this means that this adjustment will apply to all CbC reports that have been or will be submitted after 29 December 2020. The correction of a CbC report that has already been submitted means that the case is to be regarded as open again.

Further to the above, clarification is also provided in regard to the entry of taxes paid/accrued/deferred, the consideration of dividends, and the treatment of partnerships.