Who does this apply to and what are their obligations?
Under the Jersey Country by Country Reporting (“CbCr”) regulations, companies are required to provide details on an annual basis in relation to key elements of a multinational group’s (“MNE”) financial results, broken down by jurisdiction.
What is a Multinational Enterprise Group?
MNEs are, in summary, any group that has a consolidated annual turnover of or in excess of €750 million (per annum), which includes at least two enterprises, the tax residences for which are in different jurisdictions, or includes an enterprise that is resident for tax purposes in one jurisdiction, and is subject to tax with respect to the business it carries out through a permanent establishment, in another jurisdiction.
There is therefore no obligation for companies which are part of a group with less than €750 million in turnover to submit a CbCr report.
What format does a CbCr report take?
CbCr reports are required to be filed with Revenue Jersey in respect of an accounting period no later than 12 months after the end of the accounting period to which a CbCr report relates.
All CbCr reports are required to be filed in accordance with Annex III of the OECD Final Report, which sets out the model template for CbCr reports. CbCr reports must be prepared using the XML schema, which is the standard adopted by both the OECD and Revenue Jersey.
At Grant Thornton, we utilise an Excel template to collate the required information. We employ specialist software to convert this into the required XML schema format, to allow for a seamless process of report submissions.
You are obliged to notify of your intention to report
Regardless of whether a Jersey company is required to submit a CbCr report or not, any Jersey Company that is a member of a MNE group is required to notify Revenue Jersey of its intention to either submit a CbCr report or, if no CbCr report will be filed in Jersey, where the CbCr report will be filed.
Extensive penalties for non-compliance
The penalty for failing to comply with the filing obligation or failing to notify Revenue Jersey of the intention to file a CbCr report is £300. Further late filing penalties can be levied for continued non-filing for each subsequent day on which the return remains late, at an amount not exceeding £60 each day. This may increase to an amount not exceeding £1,000 per day, if the return remains outstanding after 30 days.
A penalty of £3,000 may be imposed where a person has knowingly provided inaccurate information when filing the CbCr report and has failed to inform Revenue Jersey of such inaccuracy or where the person discovers the inaccuracy after the information has been provided and fails to take reasonable steps to correct.
Our team are ready to support you
Our team of tax professionals are available to support you in preparing your CbCr reports. Please contact Andy or James to see how they can help you avoid the penalties and submit complete and correct CbCr reports before the deadline.
View other 2020 tax measures
The tax landscape is in a period of hyper change. At Grant Thornton Channel Islands, we are constantly looking for ways to support our clients and service providers so they remain ahead of the game with the ever changing tax legislation and practice.