Country-by-Country Reporting (CbCR): Preparation Guide (2026)

Quick answer: from scope to a filing-ready CbCR

A country-by-country report gives tax administrations an annual, jurisdiction-level view of an MNE group's revenue, profit or loss before income tax, cash tax, current tax accrued, stated capital, accumulated earnings, employees, tangible assets, Constituent Entities, and main activities.

This preparation guide explains how to check reporting obligations, complete the three OECD tables, reconcile the data, and review common errors before filing. It also covers US Form 8975 and distinguishes tax-authority CbCR from the separate EU public reporting regime. Local rules determine who files, when, and in what format.

Prepare and review the report in this order:

confirm the filing perimeter and local obligations;
lock the Constituent Entity and permanent-establishment population;
define every field and its source;
collect and aggregate the data consistently;
reconcile the population and numbers;
explain methods and anomalies in Table 3;
validate the required local filing format; and
retain approvals, submission evidence, and any correction history.

Warning

This guide explains the OECD framework and a practical control process. Domestic law controls the actual threshold in local currency, reporting entity, notifications, deadline, filing format, language, correction process, and penalties. Confirm every jurisdiction in the group's filing matrix for the relevant fiscal year.

Rule and source status

The following source layer was checked on 16 August 2026:

Topic	Source version used	What it governs
OECD model framework and tables	Action 13 Final Report, October 2015	Model threshold, filing architecture, Tables 1-3, definitions, and model 12-month deadline
OECD interpretive guidance	May 2024	Questions that arose during implementation, including data and filing interpretations
OECD common-error list	May 2025	Errors observed by tax administrations and the stated correct treatment
OECD exchange schema	CbCR XML Schema and User Guide, version 2.0, June 2019	Standardized government-to-government exchange format
Global implementation	OECD 2025 peer review, published September 2025	Implementation status and peer-review findings
United States	IRS Form 8975 pages and December 2020 instructions, IRS pages reviewed in 2026	US filing threshold, form, timing, and filing mechanics
EU public CbCR	Directive (EU) 2021/2101 and Implementing Regulation (EU) 2024/2952	Separate public reporting regime and electronic format

The OECD periodically updates its implementation guidance and common-error material. Local legislation can change independently of the OECD documents.

1. Understand what CbCR can and cannot show

CbCR is part of the three-tier Action 13 documentation framework alongside the master file and local file. It gives tax administrations an early view of where the group reports income, taxes, people, capital, and assets.

Action 13 limits how the information should be used. A CbC report supports high-level transfer pricing and other BEPS risk assessment and, where appropriate, economic and statistical analysis. It does not replace a functional and comparability analysis of individual transactions. The report alone is not conclusive evidence that transfer prices are correct or incorrect and should not be used to impose a formulary allocation of income.

That distinction matters inside the group too. Ratios such as profit per employee or tax accrued divided by profit may reveal a question worth investigating. They do not answer the question without facts from the local file, accounts, agreements, tax provision, and business teams.

2. Confirm who files and where

OECD model threshold

The Action 13 minimum standard uses annual consolidated group revenue of at least EUR 750 million in the immediately preceding fiscal year. Jurisdictions implement that standard through domestic law, often using a local-currency equivalent. Currency fluctuations, short periods, mergers, demergers, and the definition of revenue can affect the analysis.

Use the OECD threshold as the start of the scope review, not as the final legal conclusion.

Filing decision sequence

For every reporting period:

Identify the Ultimate Parent Entity and its tax residence.
Confirm whether the group is an MNE group with Constituent Entities or a permanent establishment in more than one tax jurisdiction.
Test the prior-period consolidated revenue under the law that applies to the Ultimate Parent Entity.
Determine whether the Ultimate Parent Entity files, a Surrogate Parent Entity has been appointed, or a permitted secondary filing mechanism applies.
Check whether local Constituent Entities must submit notifications and whether the filing jurisdiction has an effective exchange relationship with each relevant jurisdiction.
Record each deadline, form, portal, language, format, signatory, and correction route in a dated filing matrix.

Note

The OECD model legislation sets a filing deadline no later than 12 months after the last day of the reporting fiscal year. That is not a universal taxpayer deadline. Domestic law may use a different mechanism or connect the filing to another return.

US Form 8975

The IRS requires certain US persons that are the Ultimate Parent Entity of a US MNE group with USD 850 million or more of revenue in the preceding annual reporting period to file Form 8975 and Schedules A. The IRS instructions state that the form is filed with the Ultimate Parent Entity's income tax return for the tax year in or within which the CbCR reporting period ends; it is not a standalone filing.

Use the current IRS Form 8975 page and Form 8975 instructions for the filing period. The IRS currently lists the form and instructions as December 2020 revisions, while its CbCR guidance pages were reviewed in 2026.

3. Lock the reporting perimeter

The entity population is the spine of the report. Build it from the consolidation system and legal-entity register, then test it against tax and permanent-establishment records.

Under the Action 13 template, a Constituent Entity includes:

a separate business unit included in the group's consolidated financial statements;
a business unit excluded solely on size or materiality grounds;
a business unit that would be consolidated if its equity were publicly traded; and
a permanent establishment for which a separate financial statement is prepared for financial reporting, regulatory, tax-reporting, or internal-management purposes.

Permanent-establishment data belong in the jurisdiction where the permanent establishment is situated. The residence-jurisdiction row for the legal entity should exclude that permanent-establishment data.

Population control

Control	Preparer evidence	Review question
Consolidated entities captured	Consolidation perimeter and change report	Is every consolidated business unit included?
Materiality exclusions captured	Consolidation eliminations and materiality list	Were entities omitted from consolidation solely for size or materiality added back?
Permanent establishments captured	Tax register and branch ledger list	Does every qualifying permanent establishment have a separate Table 2 entry and correctly attributed data?
Residence determined	Tax-residence file and adviser confirmations	Is residence based on the relevant tax rule rather than incorporation alone?
Changes explained	Acquisition, disposal, merger, and liquidation log	Do opening and closing populations reconcile, including effective dates?
Table consistency checked	Automated Table 1/Table 2 comparison	Does every jurisdiction in Table 1 appear in Table 2 and vice versa?

Do not use the prior-year population as the sole source. Roll it forward against live legal and consolidation records.

4. Prepare the three tables

Table 1: allocation by tax jurisdiction

Table 1 aggregates these fields for each tax jurisdiction:

Field	Preparation question
Unrelated-party revenue	Which accounts and counterparties meet the reporting definition?
Related-party revenue	Is the counterparty a Constituent Entity, and are classifications consistent across systems?
Total revenue	Does it equal unrelated-party plus related-party revenue?
Profit or loss before income tax	Are the source and treatment of dividends from Constituent Entities consistent with current OECD guidance?
Income tax paid on a cash basis	Are refunds and payments captured in the correct period and jurisdiction?
Income tax accrued for the current year	Is this current tax only, excluding deferred tax and provisions for uncertain liabilities?
Stated capital	Is the amount aggregated without duplicating permanent-establishment data?
Accumulated earnings	Is the source definition applied consistently?
Number of employees	Is the group using full-time equivalents, year-end headcount, or another permitted consistent approach?
Tangible assets other than cash and cash equivalents	Are net book values used, with cash, intangibles, and financial assets excluded?

The Action 13 instructions allow the reporting group to use consolidation packages, separate-entity statutory accounts, regulatory accounts, or internal management accounts. Use the same source consistently from year to year and explain the source in Table 3.

Note

Intercompany dividends: For reporting fiscal years beginning on or after 1 January 2025, the OECD's May 2024 implementation guidance excludes qualifying dividends received from another Constituent Entity from both Revenue and Profit (Loss) before Income Tax. Related cash and current-tax amounts must be treated consistently under that guidance. Confirm how the rule is implemented in the filing jurisdiction and period before finalizing the mapping.

If statutory accounts supply figures, translate them to the stated functional currency of the reporting MNE using the average exchange rate for the year and disclose the rate in Table 3. Use one currency throughout Table 1.

Table 2: Constituent Entities and activities

List every Constituent Entity by tax jurisdiction of residence, its jurisdiction of organization or incorporation if different, and all applicable main business activities. If "Other" is selected, describe the activity in Table 3.

Names, tax identification numbers, residence, incorporation, and activity codes should come from controlled reference data rather than free-text re-entry. Preserve the name and identifier used in the local filing system.

Table 3: additional information

Table 3 is part of the report, not a notes page to complete at the end. Use it to disclose:

the sources of data and any change from the prior year;
currency-conversion method and exchange rates where required;
the employee-counting convention;
acquisitions, disposals, restructurings, short periods, or other population changes;
the nature of activities reported as "Other";
the treatment of material anomalies or non-recurring items; and
explanations needed to understand the compulsory fields.

Keep explanations factual. A long narrative does not cure an incorrect number.

5. Build a controlled source-to-report chain

Assign one owner and one reviewer to every source and transformation before collection begins.

Data block	Typical owner	Core evidence	Primary control
Entity population and residence	Legal or tax operations	Legal-entity register, consolidation perimeter, PE register	Population bridge and jurisdiction mapping
Revenue and profit	Group reporting or controllership	Consolidation packages, ledgers, account mapping	Trial-balance-to-CbCR bridge and column arithmetic
Cash tax and current tax accrued	Tax accounting	Tax provision, payment records, returns	Cash/accrual distinction and jurisdiction tie-out
Capital and accumulated earnings	Group reporting	Consolidation and statutory equity records	Definition and aggregation check
Employees	HR data owner	HR system extract and contractor policy	Counting method, date or averaging rule, and jurisdiction mapping
Tangible assets	Fixed-asset or group reporting owner	Fixed-asset register and balance sheet	Net book value and excluded-asset check
Table 2 identifiers and activities	Tax operations	Legal register, TIN records, business-owner confirmation	Duplicate, missing, and invalid identifier checks
Filing output	Tax technology or compliance	Approved final tables and local schema	Schema validation and hash/version record

Data dictionary

For each field, record:

the OECD definition and the applicable local override;
source system, report, account, and extraction date;
population and jurisdiction-mapping rule;
sign convention, unit, and currency treatment;
aggregation or transformation logic;
field owner and reviewer; and
change from the prior year.

A spreadsheet heading such as "tax" is not a definition. Separate cash tax, current tax accrued, deferred tax, withholding tax, refunds, and uncertain tax positions in the source mapping before selecting what belongs in the report.

6. Reconcile before generating the filing file

Action 13 permits specified source data and says that revenue, profit, and tax figures do not have to reconcile to the consolidated financial statements. That is a reporting rule, not a reason to skip controls. A documented bridge helps the preparer prove completeness, find duplicate or omitted data, and explain why the CbCR basis differs from consolidation.

Recommended reconciliation set

Reconciliation	Minimum check	Evidence retained
Entity population	Opening entities + additions - removals = closing population	Signed population bridge
Jurisdiction population	Every Table 1 jurisdiction has at least one Table 2 entity and every Table 2 jurisdiction has a Table 1 row	Exception-free comparison report
Revenue	Unrelated + related = total for every jurisdiction	Automated arithmetic output
Financial source	CbCR source totals bridge to the selected consolidation, statutory, regulatory, or management source	Mapping and reconciling-item schedule
Currency	Every local amount converts into the single reporting currency using the approved method	Rate source and re-performance
Tax	Cash tax and current tax accrued tie to their separate source records	Tax-payment and provision bridges
Employees	Jurisdiction totals tie to the approved HR extract after documented adjustments	HR population bridge
Tangible assets	Included net book values tie to the fixed-asset source after exclusions	Asset-class mapping
Year-on-year movement	Material changes have a business or source explanation	Variance report and owner response
Cross-document story	Material CbCR facts do not conflict without explanation with the master file, local files, statutory accounts, or tax provision	Review checklist and sign-off

A practical variance review

Do not set one percentage threshold for every field. A small movement in one jurisdiction may matter more than a large, well-understood movement elsewhere. Review at least:

new or missing jurisdictions and entities;
revenue, profit, tax, employee, or asset movements inconsistent with business events;
profit where there are few people and little tangible property;
large cash-tax/current-tax timing differences;
negative tax figures and unexpected sign changes;
repeated prior-year values; and
changes caused by source systems, mappings, or foreign-exchange methods.

The owner should resolve the source data or provide a clear Table 3 explanation where the reported result is correct.

7. Prevent the errors identified by the OECD

The OECD's May 2025 common-error document lists issues found in filed reports. Convert those observations into pre-filing tests:

OECD-observed error	Pre-filing test
Missing, blank, repeated, or inappropriate `NOTIN` tax identification numbers	Validate each identifier against the entity master and local format; use `NOTIN` only where no TIN has been issued
More than one currency in Table 1	Confirm one reporting currency and reperform conversion
Shortened figures, decimals, or excessive rounding	Produce full monetary amounts without decimals under the OECD format and apply only locally permitted rounding
Figures transposed between columns	Apply data-type and reasonableness checks to employees, tax, assets, and revenue
Total revenue does not equal related plus unrelated revenue	Run an exact row-level arithmetic validation
Qualifying dividends from Constituent Entities included in revenue or profit, or related tax treated inconsistently	Test the revenue, profit, cash-tax, and current-tax mappings against the May 2024 guidance for the applicable reporting period
Data sources or exchange rates omitted from Table 3	Make both fields mandatory in the sign-off checklist
Table 1 and Table 2 contain different jurisdictions	Compare the two jurisdiction sets automatically
Materiality-excluded entities or permanent establishments omitted	Reconcile to consolidation exclusions and the PE register
"Other" activity selected without explanation	Require Table 3 text before finalization
Incorrect reporting-period end date	Validate against the reporting MNE's fiscal-year end, not the submission date
Correction submitted without the proper correction references	Follow the current local correction process and preserve links to the original filing
Invalid XML characters	Validate and escape content through the approved schema tool rather than editing XML manually

The OECD document says errors should be corrected when identified. The form, timing, and technical method for a taxpayer correction still depend on the receiving jurisdiction.

8. XML, portals, and technical validation

OECD exchange schema

The OECD currently lists the CbCR XML Schema and User Guide version 2.0, published June 2019, as the standardized format for exchange of CbC reports between jurisdictions. The related Status Message XML Schema lets receiving administrations send structured feedback about errors.

The exchange standard is not automatically the format a taxpayer uploads. Jurisdictions may provide a portal, spreadsheet, PDF form, local XML schema, or tax-return attachment and then convert the filing for exchange.

US electronic filing

The IRS says US taxpayers filing electronically use an IRS-approved XML schema compatible with the Modernized e-File system for Form 8975 and Schedules A. This is part of the income-tax return filing, not a direct upload of the OECD exchange file.

Technical control sequence

Freeze the approved human-readable tables.
Generate the local filing output from the approved version.
Validate it against the exact local schema or portal rules for the reporting period.
Reconcile the generated output back to the approved tables.
Run identifier, date, currency, character, arithmetic, and mandatory-field tests.
Obtain named preparer and reviewer approval.
Retain the filed file, validation output, submission receipt, message reference, timestamp, and checksum.
Track any rejection, correction, or replacement back to the original submission.

Tip

Schema-valid does not mean tax-valid. Technical validation can confirm formats and relationships, but it cannot decide whether the entity population, residence, source data, or tax treatment is correct.

9. Notifications, secondary filing, and exchange

Under the OECD architecture, the Ultimate Parent Entity generally files in its residence jurisdiction and the report is exchanged government to government with jurisdictions where the group operates and an exchange relationship is effective. A Surrogate Parent Entity may file on the group's behalf under the relevant conditions. Secondary or local filing is a backup mechanism in limited circumstances.

Local notification obligations are separate from the report itself. A Constituent Entity may need to identify the Reporting Entity and its residence before the CbCR filing deadline. Build notifications into the same filing matrix and do not infer their deadline from the model 12-month report deadline.

Before filing, verify:

the Ultimate or Surrogate Parent filing rule;
each Constituent Entity notification;
effective exchange relationships;
any permitted or required secondary filing;
required language and form;
local correction procedures; and
record-retention and penalty rules.

The OECD CbCR portal links to implementation guidance and exchange information. Domestic tax-authority sources remain controlling for taxpayer obligations.

10. EU public CbCR is a separate report

EU public country-by-country reporting under Directive (EU) 2021/2101 is different from confidential tax CbCR. The public regime requires qualifying EU and non-EU multinational groups with significant EU activity to publish specified income-tax information.

The directive applies a EUR 750 million consolidated-revenue test over two consecutive financial years, subject to its detailed scope and exemptions. Member States had to apply the reporting requirements, at the latest, for financial years starting on or after 22 June 2024.

Commission Implementing Regulation (EU) 2024/2952 establishes the common template and requires XHTML with Inline XBRL markup for reports within its scope. Its template and electronic-format rules apply to financial years starting on or after 1 January 2025.

Confidential tax CbCR	EU public CbCR
Filed with a tax administration and exchanged under legal instruments	Published and made accessible to the public
OECD Action 13 template and domestic tax law	EU Accounting Directive as amended and Member State implementation
Jurisdiction aggregation follows the tax-reporting framework	Publication breakdown follows the EU public-reporting rules
OECD XML supports government exchange; local taxpayer formats vary	Implementing Regulation 2024/2952 provides the common XHTML/iXBRL format for reports in scope
Used for high-level tax risk assessment and related permitted purposes	Designed for public corporate income-tax transparency

Do not publish the confidential tax CbC report as a shortcut. Map the public-reporting definitions, scope, breakdown, content, format, approval, and publication process separately. See the EU public CbCR guide for the dedicated workflow.

11. CbCR, transfer pricing documentation, and Pillar Two

The same systems may feed the CbC report, master file, local files, and Pillar Two calculations, but their definitions are not interchangeable.

Run a consistency review across:

group and entity names;
business activities and value-chain descriptions;
revenue and profit narratives;
tax jurisdictions and permanent establishments;
headcount and tangible-asset explanations;
restructurings, acquisitions, and disposals; and
source-system and foreign-exchange policies.

The OECD's Pillar Two transitional CbCR safe harbour has its own qualifying-report and data requirements. A technically correct Action 13 CbC report does not automatically satisfy them. Use the Pillar Two CbCR guide and the current OECD Pillar Two materials for that separate analysis.

12. Filing-ready review checklist

CbCR preparation and control checklist

01The filing threshold, Reporting Entity, notifications, deadline, format, and exchange position are confirmed under current local law
02The Constituent Entity and permanent-establishment population reconciles to legal, consolidation, and tax records
03Every Table 1 field has a documented definition, source, owner, sign convention, unit, currency rule, and transformation
04The same approved source method is used consistently or the change is explained in Table 3
05Table 1 arithmetic, Table 1/Table 2 jurisdiction consistency, tax identifiers, dates, and currency have passed automated checks
06Financial, tax, HR, and tangible-asset totals bridge to their selected source records with documented reconciling items
07Material year-on-year movements and business changes have been resolved or explained factually
08Table 3 states the data sources, required currency information, counting conventions, and material anomalies
09The local filing output passes the correct schema or portal validation and reconciles to the approved tables
10Approvals, filed output, validation record, submission receipt, and correction history are retained together

Frequently asked questions

What is the OECD CbCR threshold?

The Action 13 minimum standard uses consolidated group revenue of at least EUR 750 million in the immediately preceding fiscal year. Domestic law determines the operative local-currency threshold, revenue definition, filing entity, and exceptions.

Is the CbCR deadline always 12 months after year-end?

No. Twelve months is the deadline in the OECD model legislation. Local law controls. For example, US Form 8975 is filed with the Ultimate Parent Entity's income tax return for the tax year in or within which the reporting period ends.

Must CbCR figures reconcile to consolidated financial statements?

The Action 13 instructions permit several source types and state that revenue, profit, and tax figures do not have to reconcile to consolidated financial statements. A controlled bridge to the chosen source is still a sound completeness and review control, particularly when the CbCR basis differs from consolidation.

How should employees be counted?

The Action 13 instructions permit year-end numbers, an average for the year, or another consistently applied basis. Independent contractors participating in ordinary operating activities may be reported. Document the method, apply it consistently across jurisdictions and years, and avoid materially distorting the relative distribution.

What belongs in tangible assets?

Report the aggregate net book value of tangible assets in the relevant jurisdiction. The Action 13 instructions exclude cash and cash equivalents, intangibles, and financial assets. Attribute permanent-establishment assets to the jurisdiction where the permanent establishment is situated.

What is the current OECD CbCR XML schema?

The OECD currently lists version 2.0, published in June 2019, for government-to-government exchange. Confirm the taxpayer filing format separately with the relevant tax administration.

Can a tax administration adjust transfer prices directly from CbCR ratios?

Under Action 13, the CbC report should not replace a detailed functional and comparability analysis, does not by itself prove that transfer prices are right or wrong, and should not be used for formulary apportionment adjustments.

Is EU public CbCR the same as tax CbCR?

No. EU public CbCR is a public-reporting regime under the Accounting Directive framework. It has its own scope, breakdown, content, publication, and electronic-format rules. Prepare it as a separate controlled output.

Country-by-Country Reporting (CbCR): Preparation Guide (2026)Country-by-Country Reporting (CbCR): Preparation Guide (2026)

TL;DR key takeaways