Senegal has embraced international tax transparency standards and adopted the Country-by-Country Reporting (CbCR) requirements in line with the OECD’s Base Erosion and Profit Shifting (BEPS) Action 13 initiative. These regulations are designed to promote transparency, prevent tax avoidance, and ensure that multinational enterprises (MNEs) are taxed fairly on the profits generated in each country where they operate. This guide provides CFOs and financial executives with an understanding of the CbCR regulations in Senegal, covering applicability, the reporting process, submission deadlines, penalties for non-compliance, and key resources to assist with compliance.

Applicability of CbCR in Senegal

Criteria for Reporting:

• Senegal’s CbCR requirements apply to multinational enterprise (MNE) groups with consolidated group revenues of at least XOF 491 billion (approximately €750 million) in the previous fiscal year.
• The obligation to file a CbC report lies with the ultimate parent entity of the MNE group if it is a tax resident in Senegal.
• If the ultimate parent entity is located in a jurisdiction that does not require CbCR or does not participate in the automatic exchange of CbC reports, a constituent entity based in Senegal may be required to file the report on behalf of the group.

Relevant Legislation:

• CbCR in Senegal is governed by the General Tax Code and is aligned with the OECD BEPS framework, reflecting the country’s commitment to international tax cooperation and transparency.

Reporting Requirements

Information to be Reported:

• The CbC report must include key financial information for each jurisdiction in which the MNE group operates, including:
  • Total revenues (split between 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)
• Additionally, a list of all constituent entities within the group must be provided, specifying their tax residency and their primary business activities.

Form and Submission:

• The CbC report must be prepared in the OECD XML schema format, ensuring consistency with international standards and enabling the automatic exchange of reports between tax authorities.
• The report must be submitted to Senegal’s Directorate General of Taxes and Domains (Direction Générale des Impôts et des Domaines – DGID), the competent authority for tax matters in Senegal.
  • Further details on the submission process can be found on the DGID website.

Filing Deadlines

• The CbC report must be submitted within 12 months after the end of the fiscal year of the MNE group. For example, if the group’s fiscal year ends on 31 December 2023, the report must be submitted by 31 December 2024.
• In addition, Senegalese entities that are part of an MNE group must notify the DGID of the identity of the reporting entity (whether it is the ultimate parent entity or a surrogate entity) no later than the last day of the fiscal year.

Penalties for Non-Compliance

Penalties:

• Senegal imposes penalties for non-compliance with CbCR requirements, which may include:
  • Fines for failure to submit the CbC report or late submission. These fines can range from XOF 10 million to XOF 50 million (approximately €15,000 to €75,000), depending on the severity of the breach.
  • Additional fines may apply for inaccurate or incomplete information.
  • Failure to submit the required notification regarding the reporting entity can also lead to fines.

Defences:

• MNEs may seek relief from penalties by demonstrating reasonable cause for non-compliance, such as administrative errors or technical difficulties. However, the DGID evaluates such cases individually, and strict adherence to reporting deadlines and accuracy is strongly recommended to avoid penalties.

Confidentiality and Use of Information

Data Protection:

• The CbC reports submitted to the DGID are treated as confidential and used primarily for assessing tax risks, including the evaluation of transfer pricing arrangements and potential tax avoidance practices.
• Senegal is a participant in the Multilateral Competent Authority Agreement (MCAA) for the automatic exchange of CbC reports, ensuring that the reports are shared with other tax authorities under strict confidentiality and data protection rules, in line with the OECD guidelines.