Country-by-Country Reporting for Multinational Groups

Introduction

Country-by-country reporting is an international tax transparency requirement for large multinational groups. If your group operates in multiple countries and meets the revenue threshold, you must register with HMRC and submit an annual report detailing your activities, profits, and taxes in each jurisdiction where you operate.

What is country-by-country reporting?

A country-by-country report is a summary of a multinational business's activities, profits, and taxes in each country where it operates. It follows an international standard set by the Organisation for Economic Co-operation and Development (OECD). HMRC uses this information to assess tax risks and shares it with other tax authorities worldwide so they can do the same.

Who needs to submit a report?

Your multinational enterprise group (MNE) must send a country-by-country report to HMRC if both of the following conditions apply:

• You have operations both in the UK and in at least one other country, including permanent establishments (a permanent establishment is a fixed place of business through which you carry out your operations, such as an office, branch, or factory)
• Your total consolidated group revenue for the accounting year before the reporting period is more than €750 million

Who is responsible for filing?

The ultimate parent entity (UPE) is responsible for sending the report. The ultimate parent entity is the top-level company in the group that is not owned or controlled by another entity.

However, a UK entity that is not the ultimate parent may also need to file a report if its ultimate parent is not required to do so in either:

• The UK
• A country that collects country-by-country reports and exchanges them with the UK

This ensures that even if the group's parent company is based in a jurisdiction with different reporting requirements, HMRC still receives the information it needs.

How to register

Before you can send your first report, you must register with HMRC to receive a CBC ID (a 15-digit reference number used for country-by-country reporting). If your group already has a CBC ID from a previous registration, you do not need to register again.

You must register using HMRC's online service. You'll need to sign in with a Government Gateway account, or you can create one during the registration process.

What you'll need to register

When registering, you'll need:

• The Unique Taxpayer Reference (UTR) for the reporting entity, if it has one
• The registered name for the business
• The registered address for the business (if it does not have a UTR)

If your business uses 'team member access' for its HMRC business tax account, an administrator will need to register. The administrator can then add team members to the service.

After registration

Once you've registered, you'll receive your CBC ID immediately in the online service and in a confirmation email. You must include this CBC ID in your report when you submit it.

How to create and submit your report

Timing

You must send your report within 12 months of the end of your reporting period. For example, if your reporting period ends on 31 December 2024, you must submit your report by 31 December 2025.

Format and technical requirements

You need to send your report as an XML file (a structured data format that machines can read). The file size must be 100MB or less.

Your report must meet two sets of rules:

• Schema rules: These define the technical structure of the XML file. You can find the country-by-country reporting XML schema and user guide on the OECD website
• Business rules: These govern what information each entry must contain. HMRC publishes a document listing the specific country-by-country business rules for each entry

The online service will automatically check your report against both sets of rules before accepting it.

Submitting the report

You submit the report through HMRC's online service. You'll need to sign in with your Government Gateway account.

The service will validate your report to ensure it meets the schema and business rules. If there are any issues, you'll be notified immediately so you can correct them before resubmitting.

HMRC will contact you using the details you provided in the service if they need more information about your report.

Correcting or deleting a report

If you discover an error after submitting your report, you can correct it by sending a different XML file through the same online service. You can add information, correct existing information, or delete specific entries. You can also delete the full report for a reporting period if necessary.

The OECD user guide contains detailed instructions on how to format correction and deletion files.

Using an agent

You can authorise an agent (such as an accountant or tax adviser) to register and send your report on your behalf. You'll still need to register first to obtain your CBC ID.

To authorise an agent, you need to give them:

• Your CBC ID
• The email address of the 'first contact' you provided in the country-by-country service

You must then accept the authorisation request from the agent using HMRC's digital handshake system.

Even if an agent will be sending the report, the reporting entity must still register first.

Getting help

If you need help with registering or using the country-by-country reporting service, you can:

• Contact your HMRC Customer Compliance Manager if you have one
• Email msb.countrybycountryreportingmailbox@hmrc.gov.uk

For technical questions about the XML schema or business rules, the same contacts can assist.

You can also check HMRC's service availability page to see if there are any known problems with the country-by-country reporting service before attempting to submit your report.

Sources

• Check if you need to send a country-by-country report
• Register to send a country-by-country report
• Send a country-by-country report

This article provides general guidance based on current HMRC rules. For advice specific to your situation, speak to your accountant.