South Africa has implemented the OECD’s BEPS Action 13 recommendations, including the adoption of Country-by-Country Reporting (CbCR) requirements. These obligations form part of the country’s broader strategy to enhance tax transparency and ensure that multinational enterprise (MNE) groups pay taxes where economic activities and value creation occur.

This guide provides an overview of South Africa’s CbCR rules, including compliance thresholds, filing obligations, and relevant penalties.

Regulatory Framework

• Authority: South African Revenue Service (SARS)
• Legislation:
  • Section 25 of the Tax Administration Act, 2011
  • Public Notice 1117 (2016) and subsequent amendments
  • Interpretation Note 121 (2021)
• International Engagement:
  • South Africa is a member of the OECD Inclusive Framework on BEPS
  • Signatory to the Multilateral Competent Authority Agreement (MCAA) for CbCR

CbCR Filing Requirements

• Who Must File:
  • South African-resident ultimate parent entities (UPEs) of MNE groups with total consolidated group revenue of ZAR 10 billion or more
  • Local constituent entities of foreign MNEs may need to file if the UPE is not required to file in its jurisdiction or if no exchange relationship exists
• CbCR Notification:
  • Required from all South African constituent entities
  • Deadline: within 12 months of the end of the reporting fiscal year
• CbCR Submission:
  • Deadline: 12 months after the end of the reporting fiscal year
  • Submission via SARS eFiling platform in XML format
  • Taxpayers must register with the SARS eFiling system and select the CbCR option

Penalties for Non-Compliance

• Administrative penalties and interest may apply for:
  • Failure to submit the report or notification on time
  • Incomplete or inaccurate reports
• Penalties are calculated based on the severity and length of non-compliance

Important Considerations

• CbCR forms part of a three-tiered transfer pricing documentation structure (Master File, Local File, and CbC Report)
• SARS may use the report for transfer pricing risk assessments
• Consistency in data across all documents is essential

Useful Resources

• South African Revenue Service (SARS): https://www.sars.gov.za
• OECD CbCR Guidance: https://www.oecd.org/tax/beps/country-by-country-reporting.htm