Country-by-Country reporting in Romania: Voluntary compliance and strengthened tax transparency | News Flash

We would like to inform you that the National Agency for Fiscal Administration (ANAF) has launched a new awareness campaign in Romania regarding the Country-by-Country reporting in Romania (or CbC, in short)applicable to multinational enterprise (MNE) groups.

Please refer to this link from ANAF’s official press release.

The initiative aims to promote voluntary compliance and strengthen tax transparency among Romanian constituent entities, in line with the international tax standards.

Who is required to do Country-by-Country reporting?

In line with the OECD BEPS Action 13 (Base Erosion Profit Shifting), Romania imposed into its local legislation that CbC reporting obligations should apply to those multinational groups who registered annual consolidated revenues exceeding EUR 750 million in the previous fiscal year. In this regard, the Romanian companies, part of such MNE groups, should carefully assess their obligations with respect to Form R405 (CbC Notification) and Form R404 (CbC Report).

Country-by-Country Notification – Form R405

First of all, any constituent entity located in Romania, part of such MNE groups, is required to submit Form R405, where the following should be declared:

• the role of the Romanian entity within the group (ultimate parent, surrogate parent, designated reporting entity or other constituent entity), and
• the identity and tax residence of the group’s reporting entity (where the CbC reporting takes places).

The submission deadline is by the last day of the MNE group’s reporting fiscal year, but no later than the deadline for filing the annual corporate income tax return (Form 101) for the previous year.

Country-by-Country Report – Form R404

Secondly, the Romanian designated reporting entity (or the Romanian ultimate parent, if the case) must prepare and file Form R404 within 12 months from the last day of the group’s fiscal year. The obligation also applies to entities that have opted for a non-calendar financial year. The CbC Report contains specific detailed information re. each tax jurisdiction where the MNE group operates, such as revenues, profit (loss) before income tax, income tax paid (on a cash basis), income tax accrued (current year), equity, number of employees, etc.

The CbC Report remains a key tool for preventing the base erosion and profit shifting and plays a central role in ensuring fairness and transparency across global tax systems.

Why voluntary compliance matters?

In this regard, we would like to highlight that timely and accurate compliance with CbC reporting obligations:

• reduces exposure to administrative penalties,
• lowers the likelihood of additional tax audits,
• facilitates smoother interaction with the tax authorities,
• reinforces the group’s tax governance and international reputation.

Also, we would like to reinforce that CbC reporting is also an important tool when it comes to OECD Pillar 2 Minimum Global Tax (15%), in order to assess whether the simplified rules under the Safe Harbour Rules would apply for the period 2024 – 2026.

How Accace Romania can support you?

Our Romanian team provides comprehensive assistance in the area of international tax reporting and CbC reporting compliance, including:

• assessing the specific obligations of each Romanian constituent entity,
• preparing and reviewing Form R405 notifications,
• preparing and reviewing Form R405 reports,
• offering guidance on BEPS-related risks and compliance expectations.

Don’t hesitate to contact us to ensure that all CbC reporting requirements are met accurately, efficiently, and with minimal risk for your organization in Romania.

Anca Ghizdavu

Tax Director | Accace Romania

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