Regulation No. 1166/2016 on Country-by-Country Reporting establishes the rules for multinational enterprises (MNEs) in Iceland to comply with country-by-country (CbC) reporting requirements. The key points are:

• MNE groups with annual consolidated revenue of at least EUR 750 million are required to file a CbC report that provides a breakdown of revenue, profits, taxes and other indicators for each tax jurisdiction where the group operates.
• The ultimate parent entity of the MNE group has primary responsibility for filing the CbC report. In certain circumstances, a surrogate parent entity or an entity resident in Iceland (an EU designated entity) may be appointed to file on behalf of the group.
• Entities within the MNE group that are resident in Iceland may have an obligation to provide either a CbC report or an equivalent CbC report through a secondary reporting mechanism if the primary reporting is not done.
• CbC reports must be filed with the Icelandic tax authorities (the Directorate of Internal Revenue) within 12 months after the last day of the fiscal year to which the report relates, for fiscal years commencing on or after January 1, 2016.
• The regulation was updated in 2017 by Regulation No. 245/2017 to conform with the OECD Model Legislation for CbC reporting under BEPS Action 13.

Iceland signed the Multilateral Competent Authority Agreement in 2016 to enable automatic exchange of CbC reports between jurisdictions.