Peru has joined the global effort to enhance tax transparency by adopting Country-by-Country Reporting (CbCR) requirements as part of the OECD’s Base Erosion and Profit Shifting (BEPS) Action 13 initiative. The aim of these regulations is to prevent multinational enterprises (MNEs) from shifting profits to low-tax jurisdictions and ensure that tax authorities have the necessary information to assess potential tax avoidance risks. This guide provides Chief Financial Officers (CFOs) and financial executives with the essential details on the CbCR obligations in Peru, including applicability, reporting requirements, submission processes, penalties for non-compliance, and useful resources.

Applicability of CbCR in Peru

Criteria for Reporting:

• The CbCR obligations in Peru apply to multinational enterprise groups with annual consolidated revenues of at least PEN 2.7 billion (approximately €750 million) in the preceding fiscal year.
• The reporting requirement falls on the ultimate parent entity of the multinational group that is a tax resident in Peru.
• In cases where the ultimate parent entity is not located in Peru, but a constituent entity of the MNE group is a tax resident in Peru, the Peruvian entity may be required to act as the surrogate parent entity and file the CbC report, especially if the ultimate parent entity’s jurisdiction does not have a CbCR requirement or does not exchange information with Peru.

Relevant Legislation:

• Peru introduced the CbCR requirements through Legislative Decree No. 1312 and Supreme Decree No. 333-2017-EF, which outline the rules for CbCR in compliance with OECD standards under BEPS Action 13.

Reporting Requirements

Information to be Reported:

• The CbC report must include the following data on a country-by-country basis for all jurisdictions where the multinational group operates:
  • Total revenues (broken down into related-party and unrelated-party revenues)
  • Profit or loss before income tax
  • Income tax paid and accrued
  • Stated capital and accumulated earnings
  • Number of employees
  • Tangible assets (excluding cash or cash equivalents)
• The report must also provide a list of all constituent entities within the MNE group, specifying their jurisdiction of tax residence and primary business activities.

Form and Submission:

• The CbC report must be prepared in the OECD XML format, which ensures consistency with global reporting standards.
• Submission is made electronically through the Peruvian Tax Administration (SUNAT) online platform.
  • Further details on the submission process can be found on the SUNAT website.

Filing Deadlines

• The CbC report must be submitted within 12 months after the end of the MNE group’s fiscal year. For example, if the fiscal year ends on 31 December 2023, the CbC report must be submitted by 31 December 2024.
• In addition to the report submission, entities that are part of an MNE group must notify the Superintendencia Nacional de Aduanas y de Administración Tributaria (SUNAT) whether they are the ultimate parent entity or surrogate parent entity responsible for submitting the CbC report. This notification must be made no later than the last day of the reporting fiscal year.

Penalties for Non-Compliance

Penalties:

• Peru imposes strict penalties for non-compliance with the CbCR requirements:
  • Failure to file the CbC report or filing it late can result in fines of up to 0.6% of the company’s total income in the fiscal year, with a maximum limit of PEN 500,000 (approximately €120,000).
  • Filing inaccurate or incomplete reports may result in additional penalties, as well as potential investigations and tax audits.
  • Failure to submit the notification or inaccurate notifications can also lead to penalties, though these are typically lower than for report filing failures.

Defences:

• Multinational groups may present reasonable cause for failure to submit or inaccuracies in the report, such as technical or administrative issues. However, leniency is rare, and compliance is highly encouraged to avoid substantial penalties.

Confidentiality and Use of Information

Data Protection:

• The CbC reports submitted to Peru’s tax authority, SUNAT, are treated as confidential. They are used solely for high-level transfer pricing risk assessment and to detect potential base erosion and profit shifting (BEPS) risks.
• Peru has signed the Multilateral Competent Authority Agreement (MCAA), ensuring that CbC reports are automatically exchanged with other jurisdictions under strict confidentiality standards. The information is only shared with countries that adhere to the OECD’s data protection rules.