Country-by-Country Reporting – notification obligation

Hungarian members of multinational groups with a calendar business year should file their Country-by-Country Report (“CbCR”) notification form by December 31, 2021 for FY2021.

The notification obligation applies to companies, branches and permanent establishments that are members of an MNE group with a consolidated revenue of EUR 750 million or above.

The taxpayer should identify which company in the group is submitting the CbCR on behalf of the taxpayer. In most cases, subsidiaries identify a company located in another country as the reporting entity, which is typically the ultimate parent company or a “surrogate parent company”. In some cases, however, the subsidiary itself may become subject of the notification obligation; in such cases, it should identify itself as the reporting entity.

Form 21T201T serves for the CbCR notification obligation that should be submitted to the tax authorities by the last day of the group’s financial year. For most taxpayers, this deadline is December 31. However, MNE groups with a financial year other than the calendar year should not be missed either, the deadline obviously differs in their case.

Its importance is well illustrated by the default penalty of up to 20 million HUF, if the notification obligation is failed.