Country-by-Country reporting obligations introduced for multinational groups

MUSCAT, SEPT 28 - Oman’s Tax Authority has issued Ministerial Decision 79/2020 setting out Country-by-Country Reporting (CbCR) obligations for multinational entity groups (MNE groups) headquartered or operating in the Sultanate. The new measures, which are effective for financial years commencing on or after January 1, 2020, follow Oman’s accession to the Base Erosion and Profit Shifting Inclusive Framework (BEPS IF) on October 20, 2017. In the interim period, Oman’s authorities have taken significant steps to implement the BEPS minimum standards to “cement its position as an attractive regional and global hub for foreign direct investment”, said multinational professional services firm Deloitte.

In an advisory to customers, Deloitte explained that the Oman CbCR rules will apply to MNE groups that have consolidated revenues of at least RO 300 million (approx. $780 million) in the financial year immediately preceding the reporting period, based on the consolidated financial statements of that preceding year. It is necessary that the ultimate parent entity (UPE) of the MNE group is resident in Oman or an Omani resident constituent entity (CE) of the MNE group (with its UPE outside Oman) is nominated as the Surrogate Parent Entity (SPE).

“The CbC report must be submitted within 12 months of the end of the reporting period. Accordingly, for the financial years commencing on January 1, 2020, the CbC report must be submitted by December 31, 2021. For Constituent Entities in Oman, notifications to the Sultanate of the Oman Tax Authority shall therefore be due by the last day of the reporting period (by December 31, 2020)’’, Deloitte further noted.

The content and format of the CbC report, according to the advisory is in line with the CbCR guidance of the Organization for Economic Co-operation and Development (OECD). “It includes aggregate information related to the amount of revenue, profit (loss) before income tax, income tax paid, income tax accrued, stated capital, accumulated earnings, number of employees and tangible assets other than cash or cash equivalents with regard to each jurisdiction in which the MNE group operates’’.