Country-by-Country Reporting (CbCR) in the UAE: Who Must File and When

For most UAE businesses, transfer pricing compliance means a disclosure form and, above certain thresholds, a Local File. For a much smaller group of very large multinational groups, there is an additional layer entirely: Country-by-Country Reporting, a requirement that exists less to test any single transaction and more to give tax authorities a global map of where a group’s profit, tax, and economic activity actually sit.

What Is Country-by-Country Reporting?

Country-by-Country Reporting, commonly abbreviated as CbCR, is a standardized reporting requirement that gives tax authorities a jurisdiction-by-jurisdiction breakdown of a multinational group’s revenue, profit, tax paid, employees, and other key economic indicators. It originates from Action 13 of the OECD/G20 Base Erosion and Profit Shifting project, which introduced CbCR as a global standard adopted by tax administrations around the world, including the UAE.

Unlike a Local File or Master File, which support a taxpayer’s own transfer pricing position for specific transactions, CbCR is primarily a risk-assessment tool for tax authorities, giving them visibility into whether a group’s reported profit allocation across countries appears consistent with where its real economic activity, employees, and assets are actually located.

Read: Transfer Pricing Guide

UAE CbCR Legal Framework

The UAE introduced CbCR requirements through Cabinet Resolution No. 32 of 2019, which was subsequently replaced and enhanced by Cabinet Resolution No. 44 of 2020. The regulations apply to financial reporting years starting on or after 1 January 2019, and designate the UAE Ministry of Finance as the Competent Authority responsible for collecting CbC Reports and exchanging them automatically with foreign tax jurisdictions under international information exchange agreements.

Who Must Comply With CbCR in the UAE

CbCR obligations apply to a UAE-resident Ultimate Parent Entity of a multinational enterprise group whose consolidated group revenue equaled or exceeded AED 3.15 billion in the financial year preceding the reporting year. Where a UAE entity is the Ultimate Parent Entity of such a group, it is generally responsible for preparing and filing the full CbC Report. Even where a UAE entity is not the Ultimate Parent Entity, every UAE constituent entity belonging to an in-scope multinational group generally has a notification obligation, confirming which entity within the group is responsible for filing the CbC Report and where that filing takes place.

Groups below the AED 3.15 billion threshold, UAE-only groups with no operations outside the country, and natural persons or non-juridical entities generally fall outside CbCR requirements entirely.

Notification and Filing Requirements

CbCR compliance in the UAE involves two distinct obligations with separate deadlines, and treating them as a single requirement is a common and costly mistake. The notification confirms which entity is responsible for filing the CbC Report and where, and must generally be submitted no later than the last day of the multinational group’s reporting fiscal year. The CbC Report itself, containing the full financial and operational data, must generally be filed within 12 months of the end of the group’s fiscal year.

The CbC Report is filed electronically through the UAE Ministry of Finance’s designated portal, using the OECD’s standardized XML schema, ensuring the data can be automatically exchanged with the tax authorities of other jurisdictions where the group operates.

What a CbC Report Contains

The CbC Report follows the OECD’s standardized three-table format. The first table presents financial data by jurisdiction, covering revenue, both related party and unrelated party, profit or loss before tax, income tax paid and accrued, stated capital, accumulated earnings, number of employees, and tangible assets other than cash, all broken down by the tax jurisdictions in which the group operates. The second table lists each constituent entity within the group, the jurisdiction in which it is tax resident, and its main business activities. The third table allows for any additional information the group considers necessary to explain the data presented in the first two tables.

CbCR vs Local File and Master File

CbCR, the Local File, and the Master File all form part of the same broader transfer pricing documentation framework, but they serve different purposes and apply to different taxpayers. The Master File provides a high-level overview of a group’s global operations and is required for UAE taxpayers belonging to groups above the AED 3.15 billion threshold. The Local File contains detailed, UAE-specific transaction analysis and applies at a much lower threshold, AED 4 million in aggregate related party transactions.

CbCR sits apart from both. It is not focused on any specific related party transaction or its pricing, the way the Local File is, and it is not a narrative description of a group’s operations, the way the Master File is. It is a structured, quantitative dataset designed specifically to let tax authorities compare a group’s profit and tax footprint against its economic footprint across every jurisdiction where it operates, at a glance.

Consequences of Non-Compliance

Failing to meet either the notification deadline or the CbC Report filing deadline exposes a UAE entity to administrative penalties under the applicable Cabinet Resolution, and the two obligations are enforced independently: missing the notification carries consequences even if the full report is later filed on time. Beyond direct penalties, an incomplete or inconsistent CbC Report can itself become a trigger for broader tax authority scrutiny, since it is specifically designed to surface exactly the kind of profit-versus-activity mismatch that invites closer transfer pricing review.

Frequently Asked Questions (FAQs)

How Farahat & Co. Can Help

CbCR is one part of a complete transfer pricing documentation framework. For a full walkthrough of related party transactions, pricing methods, and documentation requirements, see our complete transfer pricing guide.

Also check: Transfer Pricing Services in Dubai, UAE

Farahat & Co. helps UAE-headquartered groups assess their CbCR obligations, meet notification and filing deadlines, and align their reporting with UAE Corporate Tax and transfer pricing requirements.

Contact Farahat & Co. today to discuss your transfer pricing requirements.