What is country-by-country reporting and does it apply to my Dutch entity?

april 21, 2026

Country-by-country reporting (CbCR) is a tax transparency obligation that requires large multinational groups to report financial and operational data for every country in which they do business. If your company is part of a group with consolidated annual revenues of €750 million or more, CbCR is not optional. This article explains what CbCR covers, who it applies to, and what it means specifically for your Dutch entity.

What is country-by-country reporting?

Country-by-country reporting is a filing obligation under which large multinational enterprise (MNE) groups must report key financial data broken down by country. The report covers revenue, profits, taxes paid, employees, and assets for each jurisdiction in which the group operates. It gives tax authorities a consolidated view of where economic activity takes place and where profits are reported.

CbCR was introduced as part of the OECD’s Base Erosion and Profit Shifting (BEPS) framework, specifically Action 13. It forms the third tier of the OECD’s three-tier transfer pricing documentation standard, alongside the Master File and the Local File. The purpose is to give tax authorities the information they need to assess whether a group’s profits are allocated in line with actual economic activity.

The report is not a public document by default. It is submitted to the tax authority in the parent company’s country of residence and then shared with other relevant jurisdictions through automatic exchange of information agreements.

Why was country-by-country reporting introduced?

Country-by-country reporting was introduced to address concerns that large multinationals were shifting profits to low-tax jurisdictions without a corresponding shift in economic substance. Tax authorities lacked the visibility to identify these structures efficiently. CbCR was designed to close that information gap by requiring groups to map their financial footprint across all countries in a standardised format.

Before CbCR, tax authorities typically saw only the domestic picture. They could review a local entity’s accounts and transfer pricing documentation, but had limited insight into the broader group structure. A Dutch subsidiary might look perfectly compliant on its own, while the group-level profit allocation told a very different story.

By requiring a consolidated, country-level breakdown, CbCR gives authorities the context to ask better questions. If a group reports minimal profit in a country where it employs hundreds of people, that discrepancy becomes visible and can trigger further scrutiny. The Netherlands, as an active participant in OECD initiatives, adopted CbCR into Dutch law and participates in the automatic exchange network.

Who is required to file a country-by-country report?

A country-by-country report must be filed by the ultimate parent entity of a multinational group with consolidated annual revenues of at least €750 million in the preceding fiscal year. This threshold applies globally. If your group falls below this threshold, CbCR does not apply, regardless of how many countries you operate in.

The obligation rests primarily with the ultimate parent entity, which files in its country of tax residence. However, under certain conditions, a surrogate parent entity or a local entity within the group may be required to file on behalf of the group. This becomes relevant when:

The ultimate parent’s country of residence does not have a CbCR filing requirement
There is no effective exchange of information agreement between the ultimate parent’s country and the Netherlands
The exchange mechanism exists but is not functioning in practice

In those situations, the Dutch entity in the group may be designated as the reporting entity and required to file the CbCR directly with the Dutch Tax and Customs Administration (Belastingdienst).

Does country-by-country reporting apply to my Dutch entity?

Whether CbCR applies to your Dutch entity depends on two factors: the size of your group and the filing arrangements of your ultimate parent. If your group exceeds the €750 million revenue threshold and the ultimate parent’s country does not have a functioning CbCR exchange arrangement with the Netherlands, your Dutch entity will need to file locally.

Even if your Dutch entity is not the filing entity, it still has a notification obligation. Every Dutch entity that is part of a CbCR-obligated group must notify the Belastingdienst of who the reporting entity is and where the report is being filed. This notification must be submitted annually, typically by the corporate income tax return deadline.

For many foreign-owned Dutch entities, the practical question is not whether to file, but whether the exchange arrangement between the Netherlands and the parent company’s jurisdiction is active and effective. The Netherlands has exchange agreements with most major jurisdictions, including the US, the UK, Australia, Canada, and India. If your ultimate parent is based in one of these countries and files there, your Dutch entity generally satisfies its obligation through notification rather than a full local filing.

What information does a country-by-country report include?

A country-by-country report contains three tables. Together, they provide a financial and operational snapshot of the entire multinational group, broken down by tax jurisdiction. The report covers every country in which the group has a taxable presence, including through subsidiaries, branches, and permanent establishments.

The three components of a CbCR are:

Table 1: Aggregated financial data per jurisdiction, including revenue (from related and unrelated parties), profit before income tax, income tax paid, income tax accrued, stated capital, accumulated earnings, number of employees, and tangible assets
Table 2: A list of all constituent entities of the group per jurisdiction, including their tax identification numbers and main business activities
Table 3: Any additional information the group considers necessary to understand the data in Tables 1 and 2

The report uses a standardised OECD template, which means the format is consistent across jurisdictions. Tax authorities use this data not to make automatic adjustments, but as a risk assessment tool. Significant mismatches between where employees and assets are located and where profits are reported can flag a group for further review, including a closer look at transfer pricing in the Netherlands.

When and how is a country-by-country report submitted in the Netherlands?

In the Netherlands, a country-by-country report must be filed within 12 months after the end of the group’s fiscal year. For a group with a calendar year-end, this means the CbCR for the year ending 31 December must be submitted by 31 December of the following year. The notification obligation for Dutch entities follows the corporate income tax return deadline.

Filing is done electronically through the Belastingdienst’s secure portal. The report must be submitted in the OECD’s XML schema format, which is the standardised technical format used for automatic exchange. Groups that are not familiar with this format typically work with their tax advisers or compliance providers to ensure the submission meets technical requirements.

The notification process is separate from the filing itself. A Dutch entity that is not the reporting entity must still submit an annual notification identifying the reporting entity, its country of residence, and the basis on which the Dutch entity is exempt from local filing. This notification is submitted as part of the corporate income tax return process.

What are the penalties for non-compliance with CbCR in the Netherlands?

Failure to comply with CbCR obligations in the Netherlands can result in administrative fines. This applies both to failure to file a required report and to failure to submit the annual notification. The Dutch Tax and Customs Administration treats CbCR compliance as a serious matter, and penalties can be applied even when the underlying tax position of the Dutch entity is entirely correct.

Beyond direct fines, non-compliance creates broader risk. If a Dutch entity fails to notify or file when required, it signals to the Belastingdienst that the group’s compliance processes may not be well managed. This can increase the likelihood of a broader tax audit or a more detailed review of the entity’s transfer pricing documentation and intercompany arrangements.

For groups that are genuinely below the €750 million threshold or whose ultimate parent files in a country with an active exchange agreement, the compliance burden is limited to the annual notification. Getting that notification right, on time, and with accurate information is the minimum expectation.

How does country-by-country reporting relate to transfer pricing documentation?

Country-by-country reporting is one layer of a three-part documentation framework under OECD BEPS Action 13. The other two layers are the Master File and the Local File. Together, these three documents form a complete picture of how a multinational group operates and how it prices transactions between related entities. CbCR provides the high-level, group-wide view. The Master File and Local File provide the detail.

For Dutch entities, this connection is directly relevant. The Belastingdienst uses CbCR data as a starting point for risk assessment. If the group-level data raises questions about profit allocation, the next step is typically a request for the Dutch entity’s Master File and Local File. If those documents are incomplete, inconsistent with the CbCR, or simply not available, the conversation with the tax authorities becomes significantly more difficult.

This is where transfer pricing in the Netherlands becomes operational rather than theoretical. Dutch transfer pricing rules, embedded in Article 8b of the Corporate Income Tax Act, require companies to justify their intercompany pricing with clear and consistent documentation. CbCR does not replace that requirement; it supplements it. A well-prepared Master File and Local File, aligned with the CbCR data, is what allows a Dutch entity to respond to tax authority enquiries with confidence.

For foreign-owned Dutch entities that are part of larger groups, managing CbCR notifications, coordinating with the ultimate parent on the filing, and maintaining aligned transfer pricing documentation is an ongoing compliance task. If your group is approaching the €750 million threshold or you are unsure how your Dutch entity’s notification obligations are being handled, it makes sense to review your current setup. We support foreign companies with Dutch tax compliance, including transfer pricing documentation and CbCR coordination, and we are happy to help you assess your Dutch entity’s position. Feel free to get in touch with us to discuss your situation.