Indian Master File, First CbC Report Due March 31
The deadline for multinationals to submit a master file and CbC report in India is March 31, 2018, in respect of the 2016-17 financial year.
A “master file” must be furnished by multinationals if the total consolidated group revenue exceeds INR5bn and either the aggregate value of international transactions as per the books of accounts exceeds INR500m or the aggregate value of international transactions in respect of intangible property exceeds INR100m.
The master file must be submitted on Form 3CEAA. Part A of the form is required for all international groups regardless of whether they meet the prescribed threshold for furnishing a master file. Part B is required for each constituent entity of the international group if it meets the prescribed thresholds.
In addition, a CbC report must be filed in Form 3CEAD, which is based on the template provided in the OECD’s Report on Action 13 of the base erosion and profit shifting (BEPS) Action Plan.
The CbC report is one element of a new three-tiered standardized approach to transfer pricing documentation proposed under Action 13 of the OECD’s BEPS project. Through the 2016 Finance Act, a new Section 286 was inserted in the Income Tax Act to require multinationals to submit a new CbC report, in line with BEPS Action 13, if t he group’s total consolidated group revenue is INR55bn (USD851.3m) or more. It typically must be filed in a single jurisdiction, where the ultimate parent group entity is resident. In some circumstances, instead a surrogate parent entity may file a return in a different jurisdiction to where the parent is located. Additionally, Section 92D of the Act was amended to require the preparation of a master file.
