Italy Implements Country-by-Country Reporting


In the recent past, the Italian Ministry of Economy and Finance released the Ministerial Decree on its official gazette. The decree provides the detailed process of implementing the Country-by-Country Reporting (CbCR) for Italian entities representing Multinational Enterprises (MNE) Groups. The rules outlined in CbCR are based on the guidelines provided by the Organization for Economic Co-operation and Development (OECD) and the 2016 European Union directive (EU Directive 2016/881) on CbCR. The decree makes an automatic exchange of CbC reports mandatory among the EU member states.

CbC Reporting Form

Italy has published an online form for filing CbC reports with the Agency of Revenue. According to the CbCR obligations, Italian multinational entities need to submit an annual report that should include the following:

  • Amounts of revenue
  • Profit/Loss before taxes
  • Taxes paid and accrued
  • Accumulated earnings
  • Number of employees
  • Tangible assets
  • Other indicators of economic activities
CbC Reporting: Requirements & Timeline

The Ministry of Economy and Finance of Italy introduced CbC reporting requirements set in law 208/2015 that concurred with the OECD BEPS (Base Erosion and Profit Shifting) Action 13 recommendations. The law specifies CbC reporting obligations for:

  • Italian parent companies that are Ultimate Parent Entities (UPEs) of MNE groups having a consolidated annual turnover of more than or equal to €750 million in the financial year preceding the reporting period, need to prepare CbC report.
  • Italian subsidiaries that are a part of MNE groups must file the CbC report if their parent company is a resident of a country that:
    • has not implemented the CbCr
    • doesn’t have a competent authority agreement in place with Italy for the automatic exchange of information, or
    • has incurred systemic failure to exchange information
  • EU designated entities under the EU directives of the MNE group can file CbC report in their jurisdiction on behalf of the parent company. Such reporting would alleviate the obligation of local filing in Italy, provided it meets the conditions specified in the law.

The Ministerial decree requires Italian resident entities of the MNE groups to notify the tax authority before their tax returns due-date of whether they will be filing as Ultimate Parent, Surrogate parent, or EU Designated entity.

As specified in the decree, the deadline for filing CbC reports to the Agency of Revenue is within 12 months of the end of the reporting year. The Italian tax authority has a deadline of exchanging these CbC reports with the EU Member States or any other jurisdiction that has a qualifying competent authority agreement with Italy within 15 months (except for FY 2016, which is the first year reporting period, and where the deadline is 18 months).

The information shared in this article provides general information only, and not a professional advice. Should you need support on international expansion services or have a specific question about Italy, please send an email to or call us at +1-408-913-9130 to speak to one of our experts.