Country by Country Report (CbCR)

Update

Date Hal
November 2 2021 List countries QCAA (link),
March 4 2021 XML file version 2.0. CbC Report (link) dan Petunjuk Pengisian XML versi 2.0 CbC Report (link)
December 11 2020 List countries QCAA (link),
Desember 16 2019 XML Working Paper (link) dan Example of Filing XML Working Paper (link)
Guidance of Filing XML Working Paper. (link)
July 11 2018 Bilateral Competent Authority Agreement between Indonesia and the United States of America
Indonesian Language
English Language
April 27 2018 Update BCAA Indonesia-US
April 23 2018 Socialization material of Country by Country Report. (link)
April 11 2018 List of Countries have Signed with Indonesia and List of Systematic Failure Countries. (link)
Background of Country by Country Report Implementation in Indonesia

Indonesia has enacted the Minister of Finance Regulation Number 213/PMK.03/2016 concerning Types of Documents and/or Additional Information to address Base Erosion and Profit Shifting (BEPS), which causes unfairness in taxation, promote taxpayer transparency in conducting affiliated transactions, and demonstrate Indonesia's commitment as a member of the G20 and the Inclusive Framework on BEPS in implementing the minimum standards of BEPS Action 13. (PMK-213). Based on the regulation, Taxpayers who meet certain criteria are required to prepare and/or submit three types of transfer pricing documents, i.e., three-tiered transfer pricing documentation which are master files, local files, and financial reports and Country by Country Report (CbC Report).

What is a Country by Country Report?

A transfer pricing document known as a "Country-by-Country Report" (CbC Report) lists the income distribution, taxes paid, and commercial operations of each member of a company group in a manner that complies with international standards. The CbC Reports will be exchanged with other tax authorities in accordance with international agreements. In this regard, on January 26th 2017, Indonesia has signed a Multilateral Competent Authority Agreement (MCAA) on the Exchange of Country-by-Country Reports which contains agreements to exchange CbC Reports with other countries.

In its implementation, the CbC Report submitted by the Taxpayer which is the Parent Entity to the DGT. Then, the CbC Report is exchanged through an Automatic Exchange of Information (AEoI) with the tax authority of the country/jurisdiction that has a Qualifying Competent Authority Agreement (QCAA) with Indonesia. Through the AEoI, reciprocally, Indonesia will also receive the exchange of CbC Reports related to Indonesian Taxpayers whose parent entity is domiciled abroad from the country/jurisdiction where the Parent Entity is domiciled.

What is a Qualifying Competent Authority Agreement (QCAA)?

QCAA can be in the form of a Multilateral Competent Authority Agreement (MCAA) or a Bilateral Competent Authority Agreement (BCAA) to exchange the CbC Reports automatically. However, not all countries or jurisdictions that sign the MCAA are categorized as countries or jurisdictions that have QCAA with Indonesia. A country or jurisdiction is said to have QCAA with Indonesia if that country chooses Indonesia as a partner for AEOI and Indonesia is willing to exchange with that country. (List of MCAA Signatory Countries)

What types of information contains in CbC Report?

  1. Allocation of income, taxes paid, and business activities per country or jurisdiction of all members of the Business Group both domestically and abroad;
  2. List of Business Group members and main business activities per country or jurisdiction; and
  3. Other explanations relevant to the information referred to in points 1 and 2.

What Entities were Filed in the CbC Report?

  1. Ultimate Parent Entity (UPE);
  2. Each member of the Business Group that is included in the consolidated financial statements of the Parent Entity (both UPE and non-UPE) for financial reporting purposes;
  3. Any member of the Business Group that is not included in the Parent Entity's consolidated financial statements due to business size or materiality considerations; and/or
  4. Permanent Establishment (BUT).

 

The Subject of CbC Reporting

Who Must Submit CbC Report?

  1. Domestic Taxpayers who are UPE of a Business Group with a consolidated gross turnover of more than or equal to Rp. 11.000.000.000.000,00 (eleven trillion rupiah) are required to prepare and submit a CbC Report to the DGT. Submission of CbC Report through this mechanism is referred to as primary filing. This obligation also applies to UPE whose business group members are all domestic taxpayers.
  2. Domestic Taxpayers who are members of a Business Group whose UPE is a foreign tax subject with a consolidated gross turnover of more than or equal to €750,000,000.00 (seven hundred and fifty million euros) must submit a CbC Report to the DGT. Submission of CbC Report through this mechanism is known as local filing. Basically, the local filing mechanism is required only if Indonesia is unable to obtain the UPE CbC Report abroad through the AEoI mechanism. Therefore, the local filing mechanism is only required for members of a Business Group in Indonesia if the UPE is domiciled in a country or jurisdiction that:
  1. does not require submission of CbC Report;
  2. has an agreement with the Indonesian government regarding the Exchange of Tax Information but does not have a QCAA; or
  3. has QCAA but there is a systematic failure so that the CbC Report cannot be obtained by the Indonesian government from that country or jurisdiction through AEOI.

IMPORTANT THINGS YOU MUST KNOW ABOUT THE MECHANISM FOR SUBMISSION OF CBC REPORT

  1. In the event that there is more than one domestic Taxpayers who is required to submit the CbC Report through a local filing mechanism, the obligation to submit the CbC Report can be carried out by one of the constituent entities which is the resident Taxpayer as long as the Parent Entity abroad appoints one of the constituent entities in Indonesia to submit CbC Report to the DGT. However, each constituent entity in Indonesia still has to submit Notifications.
  2. The local filing mechanism is not required if the UPE abroad appoints a Surrogate Parent Entity domiciled in a country or jurisdiction that has QCAA with Indonesia and a CbC Report can be obtained through AEOI. In such case, every subsidiary in Indonesia must still submit a Notification.

 

 

 

 

 

 

 

Reporting Procedure

 

When is the Notification Filing Due?

  1. For Fiscal Year 2016: no later than 16 months after the end of Fiscal Year.
  2. For Fiscal Year 2017 onwards: no later than 12 months after the end of Fiscal Year.
 

When is the CbC Report Filing Due?

  1. For Fiscal Year 2016: no later than 16 months after the end of Fiscal Year.
  2. For Fiscal Year 2017 onwards: no later than 12 months after the end of Fiscal Year (together with the submission of Notification).
 

Contoh Pengisian Berkas (File)CbC Report XML

 

 

 

ADMINISTRATIVE SANCTIONS

Type of Offences Consequences Sanctions Legal Basis
Not submitting Notification or not attaching proof of submission of Notification in Annual SPT Tax Return is considered not submitted in accordance with Article 3 paragraph (7) of the General Provisions and Tax Procedures Law The penalty for not submitting the annual corporate income tax return is IDR 1,000,000 Article 7 paragraph (1) of the General Provisions and Tax Procedures Law
  Reprimanded in writing, then a tax audit will be carried out If the results of the tax audit result in a transfer pricing correction, a Notice of Tax Underpayment Assessment is issued with sanction 50% Article 13 paragraph (1) & (3) of the General Provisions and Tax Procedures Law
Not submitting CbC Report (attachments E, F, G Minister of Finance Regulation Number 213/PMK.03/2016) or not attaching evidence of submission of CbC Report Tax Return is considered not submitted in accordance with Article 3 paragraph (7) of the General Provisions and Tax Procedures Law The penalty for not submitting the annual corporate income tax return is IDR 1,000,000 Article 7 paragraph (1) of the General Provisions and Tax Procedures Law
  Reprimanded in writing, then a tax audit will be carried out If the results of the tax audit result in a transfer pricing correction, a Notice of Tax Underpayment Assessment is issued with sanction 50% PArticle 13 paragraph (1) & (3) of the General Provisions and Tax Procedures Law

 

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