Country-by-Country Reporting (CbCR) Compliance under Section 286 – Due Date & Key Insights (FY 2024-25)

Country-by-Country Reporting (CbCR) is an important compliance requirement for multinational enterprises (MNEs) to ensure transparency in global income and tax allocation. Indian entities that are part of such groups must carefully adhere to reporting obligations under the Income-tax Act, 1961.

What is Section 286 Compliance?

Section 286 of the Income-tax Act, 1961 mandates that:

• A parent entity, alternate reporting entity, or

• Any constituent entity resident in India

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must furnish a CbC report where the group meets the prescribed turnover threshold.

Who is Required to File?

The following entities are covered:

• Indian parent entity of an international group

• Alternate reporting entity designated for compliance

• Constituent entities in certain specified situations (e.g., when parent entity is not obligated in its jurisdiction)

Applicable Due Date (FY 2024-25)

For the reporting accounting year April 1, 2024 to March 31, 2025:

• The CbC report (Form 3CEAD) is generally required to be filed within 12 months from the end of the reporting accounting year

• Expected Due Date: 31 March 2026

Key Compliance Points

• Threshold limit: Consolidated group revenue exceeding EUR 750 million

• Filing Form: Form 3CEAD

• Notification requirement: Form 3CEAC and 3CEAE (where applicable)

• Non-compliance may attract penalties under Section 271GB

Legal References

• Section 286 of the Income-tax Act, 1961

• Rule 10DB of Income-tax Rules, 1962

• CBDT Notification No. 88/2017 dated 31 October 2017

Conclusion

CbCR is a critical global compliance obligation that requires timely and accurate reporting. Businesses must evaluate their group structure and ensure proper documentation to avoid penalties.

For expert guidance on this topic, contact your tax professional today.