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What’s New?
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2 December 2020 – Country-by-Country (CbC) System Changes
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10 November 2020 – Country-by-Country (CbC) System Changes
The Organisation for Economic Cooperation and Development (OECD) User Guide for Tax Administrations introduced in June 2019 outlines areas of improvement, which SARS and all participating administrations require you to adhere to. These system upgrades will bring consistency in the Country-by-Country (CbC) reporting, and enhance compliance across the OECD countries.
The current XML Schema Version 1.0.1 and User Guide version 1.0.1 dated September 2017 will be upgraded to align with the new XML Schema version 2.0 from 1 February 2021. To enable SARS to implement the required system changes and to provide for testing of the system, the CbC eFiling system will be switched-off from 4 December 2020 to 31 January 2021, however, eFiling will still allow filing of master files and local files during this period.
These upgrades will affect your organisation as all Multi-National Entities (MNEs) scheduled to file in December 2020 or January 2021 will now be required to file by 28 February 2021. However, those required to file by 28 February 2021 will now file on 31 March 2021. Please make the necessary changes to your XML file to align it to schema version 2.0 when uploading the CbC files. Alternatively, if an MNE prefers to capture the manual CbC01 form, the eFiling form will be enhanced by SARS to align with schema version 2.0. Both functions will be available from 1 February 2021.
SARS regrets the inconvenience caused by this change, and will remind MNEs of the above changes to reporting entities through a system message on eFiling. A formal public notice regarding the extension for impacted Multinational Entities will be published in due course. -
22 June 2020 – CbC reporting: Upload functionality
We would like to inform you that the Country-by-Country (CbC) Reporting XML file upload functionality is open for submissions from Friday 19 June 2020. SARS extends its appreciation and thanks to those Multi-National Entities (MNEs) who participated and collaborated in the initial testing phase of the upload functionality. -
30 May 2020 – Country-by-Country trade testing confirmed for 1 June – 12 June 2020
SARS would like to extend its appreciation to the Multi-National Entities (MNEs) who confirmed their interest in participating in the trade testing of the Country-by-Country Reporting (CbC) XML file upload functionality.
We would also like to thank those MNEs that have participated in the question and answer session hosted by SARS.
SARS confirms that the Trade Testing will take place as planned from 1 June to 12 June 2020.
A limited number of MNEs will participate in the trade testing and those that will participate would have received confirmation of the trade testing times and details of the test environment. -
6 May 2020 – Clarity on the OECD reference documents relating to Country-by-Country (CbC) reporting
See our correspondence issued to MNE’s to address the issue and also see the updated BRS on the OECD CbC Reporting version 2.5 and and OECD referenced documentation: -
29 April 2020 – Invitation to participate in Trade Testing for Country-by-Country reporting submission functionality
SARS is in the process of affording Multinational Entities (MNEs) an alternative functionality to enable them to submit their Country-by-Country (CbC) reports. See our correspondence to MNEs here and click here for the BRS on the OECD CbC Reporting version 2.4. -
25 June 2018 – New exchange of information system kicks off
SARS has implemented a system that provides for the transmission of CbC reports to other tax jurisdictions in terms of the Multilateral Competent Authority Agreement (MCAA) and the bilateral Competent Authority Agreement, as well as the exchange of transfer pricing documentation on request between the participating authorities.
Companies that are liable for CbC reporting (Ultimate Parent Entity (UPE) or other MNE entities must do so no later than 12 months after the last day of the reporting fiscal year of the MNE group. Notifications pertaining to the entity responsible for filing these reports must be provided to SARS by the same date.
What is it?
Corporates and connected persons such as groups of companies, trusts, partnerships or natural persons and Multi-National Entities (MNEs) present some complex compliance risks.
To close the gaps and address the mismatches between the tax systems of multiple countries the Base Erosion and Profit Shifting (BEPS) Action Plan was adopted by the OECD and G20 countries, including South Africa, in 2013.
The OECD / G20 BEPS project provided the ambit for the development of Country-by-Country (CbC) reporting. CbC reporting requires MNE Groups to report on their operations in every country that they operate in. These reports will enable revenue authorities to assess transfer pricing risks and other BEPS related risks with respect to the MNE Groups operating in their countries.
How does it work?
On 23 December 2016 (see Notice R.1598) regulations specifying the changes to the CbC Reporting Standard for MNE Groups specifically required for South Africa’s circumstances, were published under the Tax Administration Act, 2011. The South African CbC Regulations were closely modelled on the legislation related to CbC reporting published in the BEPS Action 13 (2015) Final Report. In addition, a public notice (see Public Notice 1117) under section 25 of the Tax Administration Act requires the filing of the CbC Reports, master files and/or local files. An extension of the initial deadline for filing these reports were given in Public Notice 1308 of 8 December 2017. SARS will be able to receive and exchange information provided in the CbC Reports, master files and/or local files with other jurisdictions.
Who is required to report on their operations?
- The Ultimate Parent Entity (UPE), resident in South Africa, of an MNE Group with a total consolidated group revenue of R10 billion or more during the Fiscal Year immediately preceding the Reporting Fiscal Year, as reflected in its Consolidated Financial Statements for such preceding Fiscal Year, is required to file a CbC Report (CbC01), master file and local file
- Any MNE Entity with potentially affected transactions for the year of assessment, without offsetting any potentially affected transactions against one another, that exceeds or is reasonably expected to exceed R100 million, is required to file a local file and may also be required to file a master file.
The Ultimate Parent Entity or other MNE Entity must submit the required information as stipulated in the Business Requirements Specification (BRS): Country-by-Country and Financial Data Reporting. Local filing of a CbC Report (CbC01) by others members of an MNE Group is required in the circumstances as described in Article 2(2) read with Article 2(3) of the CbC Regulations. A list of countries that have a current International Agreement in place with South Africa but do not have a Qualifying Competent Authority Agreement in place for purposes of Article 2(2) is available on the link provided. The OECD website can be accessed for regular updates as jurisdictions activate their bilateral exchange relationships for CbC reporting
What is the due date for submitting returns?
A UPE or other MNE entity that must file a CbC Report, master file and local file must file no later than 12 months after the last day of the Reporting Fiscal Year of the MNE Group. An MNE entity that must only file a local file (and master file) must file no later than 12 months after its year of assessment.
Country-by-Country Notifications
Notifications in terms of Article 3 of the CbC regulations for filing the CbC reports must be provided to SARS no later than 12 months after the last day of the Reporting Fiscal Year of the MNE Group. The Country-by-Country email notifications are no longer required, as this has been incorporated into the ITR14 return. Taxpayers must complete the required information in the ITR14 return for the CbC notification to SARS.
How to submit a return?
The CbC01 form is now available for electronic submission on the SARS eFiling platform using the CbC link. Kindly note that for the purpose of submitting the CbC01 form, currently SARS does not support submissions for CbC using any mobile devices. As mentioned the reporting requirements are stipulated in the BRS which also contains the requirements pertaining to the CbC01 form, master file and local file.
The master file and local file will have limitations in term of the size to be transmitted. Each file should not exceed 5MB and combined files will be limited to 100MB per submission. All documents will be converted to PDF when they are transmitted.
How will the exchange of information take place?
The CbC Report will be saved on the SARS system for SARS use and transmission to other tax jurisdictions in terms of the Multilateral Competent Authority Agreement (MCAA) and bilateral Competent Authority Agreement. See the list of signatories to the MCAA.
On request from other tax jurisdictions, components of the master file and local file will be exchanged with such tax jurisdictions under treaty.
Need Help?
Should you need more help, please send an email to Bus_Sys_CDSupport@sars.gov.za.
| Country-by-Country(CbC) Documents |
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| BRS on the OECD CbC Reporting version 2.4 |
Frequently Asked Questions
FAQ: Who is required to report?
The Ultimate Parent Entity (UPE) of a group must file...
Read MoreFAQ: What format must the return be in?
The return must be in the format specified in the...
Read MoreFAQ: Must members of MNE Groups notify SARS of who will file?
Yes, Article 3 of the CbC Regulations stipulates the notification...
Read MoreFAQ: Should non- resident UPEs of MNE Groups file the notifications under Article 3 of the CbC Regulations?
No, notification would not be required, since the UPE would...
Read MoreFAQ: What are the filing obligations of an entity w.r.t submission of returns for CbC Report, Master File and Local File?
The Reporting Entity (i.e. MNE Group’s UPE that is resident...
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