Tunisia, as part of its commitment to international tax transparency and to combat Base Erosion and Profit Shifting (BEPS), has adopted the OECD’s recommendations under BEPS Action 13 regarding Country-by-Country Reporting (CbCR). The CbCR regime in Tunisia mandates large multinational enterprise (MNE) groups to provide a report on their global income, taxes paid, and other financial information across all jurisdictions in which they operate. This guide is intended for CFOs and financial executives of MNEs in Tunisia, providing essential details on the applicability of CbCR regulations, reporting requirements, filing procedures, and penalties for non-compliance.

Applicability of CbCR in Tunisia

Criteria for Reporting:

• The CbCR requirements in Tunisia apply to multinational enterprise (MNE) groups with consolidated revenues of at least €750 million (or equivalent in local currency) in the preceding fiscal year.
• The ultimate parent entity of the group, if a tax resident in Tunisia, is responsible for filing the CbC report.
• In cases where the ultimate parent entity is not a tax resident in Tunisia, a Tunisian constituent entity may be required to file a CbC report if:
  • The parent entity’s jurisdiction does not impose CbCR,
  • There is no agreement for the exchange of CbC reports between Tunisia and the parent entity’s country, or
  • There is a systemic failure in the exchange of CbC reports between Tunisia and the parent entity’s jurisdiction.

Relevant Legislation:

• Tunisia’s CbCR framework is in line with the OECD’s BEPS Action 13 and is embedded within the country’s Tax Code and Finance Law. The regulations ensure the alignment of local tax practices with international standards on tax transparency and information sharing.

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Reporting Requirements

Information to be Reported:

• MNE groups must prepare a CbC report detailing financial and tax-related information for each jurisdiction in which they operate, including:
  • Total consolidated revenue (distinguished between related-party and unrelated-party revenue),
  • Profit or loss before income tax,
  • Income tax paid and accrued,
  • Capital and accumulated earnings,
  • Number of employees,
  • Tangible assets other than cash or cash equivalents.
• A list of all entities within the group must also be included, with details of their respective tax jurisdictions and their principal business activities.

Form and Submission:

• The CbC report must be prepared in the OECD’s standard XML format, ensuring that it conforms to international submission standards.
• The report is submitted electronically to the Tunisian Ministry of Finance through its dedicated tax portal. For guidance on electronic submission, visit the Ministry of Finance website.

Filing Deadlines

• The CbC report must be filed within 12 months from the last day of the reporting fiscal year of the MNE group. For example, if the fiscal year ends on 31 December 2023, the report must be submitted by 31 December 2024.
• Additionally, Tunisian constituent entities of an MNE group are required to notify the Ministry of Finance of the identity of the reporting entity (whether it is the ultimate parent or a surrogate parent entity) by the end of the fiscal year.

Penalties for Non-Compliance

Penalties:

• Tunisia imposes financial penalties for failure to comply with CbCR requirements, including:
  • Failure to submit the CbC report or delays in filing can result in fines ranging from TND 10,000 to TND 50,000 (approximately €3,000 to €15,000).
  • Providing incomplete or inaccurate information in the CbC report can also lead to further penalties.
  • Failure to notify the tax authorities about the identity of the reporting entity can incur administrative fines.

Defences:

• In some instances, penalties may be waived or reduced if the taxpayer can demonstrate a justifiable reason for non-compliance, such as technical issues or unavoidable circumstances. However, businesses are advised to establish robust internal processes to ensure compliance with all deadlines.

Confidentiality and Use of Information

Data Protection:

• CbC reports filed in Tunisia are used for tax risk assessment purposes only and are treated with the utmost confidentiality.
• Tunisia participates in the Multilateral Competent Authority Agreement (MCAA), which allows for the automatic exchange of CbC reports between tax authorities under the OECD framework. Reports are shared only with jurisdictions that meet the OECD’s confidentiality and data protection standards.