Cyprus signed the Organisation for Economic Co-operation and Development’s Multilateral Competent Authority Agreement for the Automatic Exchange of Country-by Country Reports between its member states on 1 November 2016 after approval by the Council of Ministers at its meeting held on 28 September 2016. Following publication in the government gazette on 30 December 2016 the agreement is now binding on Cyprus in accordance with article 169.3 of the Constitution.
The agreement provides for multinational enterprises to report specified information each year in respect of each tax jurisdiction in which they do business in a “Country-by-Country” report.
The Ministry of Finance has announced that it intends to issue a Ministerial Order under Article 6 (16) of the Assessment and Collection of Taxes Laws to implement the reporting requirements, which will apply to multinational businesses with a consolidated turnover of €750 million and above. Constituent entities of multinational enterprises which have their tax residence in Cyprus will be required to inform the Cyprus tax authorities if they are the ultimate parent entity or the surrogate parent entity in terms of the reporting framework before the end of the enterprise’s financial reporting period.