European Council Adopts the Implementing Regulation on CbC Electronic Tax Reporting

On November 29, the European Council adopted the Implementing Regulation 2024/2952, which establishes requirements for the electronic drawing up and presentation of income tax information for public country-by-country reporting (CbC), as stipulated by Directive 2013/34/EU on the annual financial statements. The regulation contains provisions on the common template and electronic machine-readable reporting formats, such as XHTML (Extensible Hypertext Markup Language).

As a reminder, CbC reporting stipulates for the drawing up and publication of tax information and other financial data by ultimate parent entities in the EU, whose consolidated revenue of the last two consecutive financial years exceeds EUR 750 mln in each financial year.

There are four main parts of the document detailing the following issues:

◉ Annex I – a common template of the public CbC tax information report, containing data on the reporting entity and its financial results of the year;

◉ Annex II – XBRL (eXtensible Business Reporting Language) standards for the electronic communication of financial data;

◉ Annex III – rules of marking up and filing the reports. The data included must be machine-readable and put out in a unified format;

◉ Annex IV – digital reporting taxonomy elements, used to clarify the data to be reported.

The Regulation provides for a transition period for adaptation to the new reporting format, which will be applied for public CbC reporting for the financial years commencing on or after January 1, 2025.

Implementing Regulation 2024/2952