Cyprus' Tax Authority Issues Clarification Note Regarding Bilateral CAA With US

In early September the Cypriot Tax Department issued an announcement informing the public that the bilateral Competent Authority Agreement, "Country-by-Country (CbC) reporting", between Cyprus and the US is still under negotiation. Upon its conclusion, it is expected that this will be effective for Reporting Fiscal Years starting on or after 01 January 2020. Consequently, a secondary filing obligation is triggered for Reporting Fiscal Years starting on or after 01 January 2019 but before 01 January 2020. Consequently, a Cypriot constituent entity whose ultimate parent entity is a US tax resident entity, will be required to proceed with a local filing of the CbC report in Cyprus for its Reporting Fiscal Year ending on 31 December 2019, even if a CbC report has or will be submitted in the US. Moreover, the submitted notifications pertaining to the period 1 January to 31 December 2019, need to be revised before 31 December 2020 in order not to be subject to any penalties.