Country-by-country reporting (CbCR) was implemented in
Bulgarian legislation via the Act to Amend and Supplement the
Tax and Social Security Procedure Code (TSSPC), which was
published in issue 63 of the State Gazette on August 4
2017.
Through the introduction of CbCR, the tax authorities trying
to implement stricter rules to combat tax avoidance and working
on further harmonising local laws with OECD guidelines.
MNE groups will be obliged to submit the CbC report in
Bulgaria in the following cases:
- An ultimate parent entity of the MNE group
is resident in Bulgaria and the total consolidated turnover
of the group is in excess of BGN 100 million ($60 million);
or
- A constituent entity of the MNE group is
resident in Bulgaria, whereas the ultimate parent company is
not, and the consolidated turnover exceeds €750 million
($881 million).
The CbC report must include information for each entity of
the MNE group, including the nature of the main business
activities and some aggregated financial data.
In case the CbC report is completed by the ultimate parent
company, it must be submitted to the tax authority
electronically within 12 months of the last day of the group's
reporting fiscal year. Otherwise, it must be submitted within
15 months of the abovementioned period. If the CbC report is
submitted by the ultimate parent company, it should be prepared
for the group's fiscal year commencing in 2016. If it concerns
a constituent entity of the group, the report must be prepared
for the group's fiscal year commencing in 2017.
To meet the above criteria, the tax authority must be
notified:
- By the ultimate parent Bulgarian resident
entity of an MNE group, no later than the last day of the
reporting fiscal year of the group; or
- By a Bulgarian resident entity of the MNE
group (excluding the above cases), describing which is the
reporting entity submitting the CbC report and its
jurisdiction of residence. The relative deadline is no later
than the last day of the group's reporting fiscal year.
The notification for the first reporting period (2016) must
be provided to the tax authority no later than December 31
2017.
The penalties for infringements include:
- Failure to notify the tax authority will
result in penalties ranging from BGN 50,000 to BGN 100,000
for the first violation, and from BGN 100,000 to BGN 200,000
for subsequent violations;
- For not filing or delayed filing of the
CbC report, penalties range between BGN 100,000 and BGN
200,000. When a repeated infringement occurs, the penalty may
reach BGN 300,000; and
- Incomplete or incorrect filing of the CbC
report will lead to a penalty ranging between BGN 50,000 and
BGN 150,000. For repeated infringements, the penalty may
range between BGN 100,000 and BGN 200,000.
|
Maria Anastasiou |
Maria Anastasiou (maria.anastasiou@eurofast.eu)
Eurofast
Tel: +30 210 8257720-22
Website: www.eurofast.eu