The Canada Revenue Agency (CRA) recently shared an advisory that it is using country-by-country reporting to more effectively identify Transfer Pricing and Profit Shifting Risks. It is working with international partners, including a recent agreement with the U.S., to improve global tax transparency and address income tax base erosion and profit shifting (BEPS). Country-by-country reporting (CbCR) requires large multinational enterprises to provide high-level information regarding their global activities. The CRA will use country-by-country reports to identify transfer pricing and other profit shifting risks and will share the information on the activities of multinational enterprises to ensure that they meet their tax obligations. Furthermore, the CbCR will be used to enhance the CRA’s risk assessment process and will be exchanged with other countries beginning in 2018.
For more information on the CRA’s tools to tackle tax evasion and aggressive tax avoidance, both domestically and internationally visit Cracking down on offshore tax evasion and aggressive tax avoidance.