The Spanish Tax Agency (AEAT) has launched a notification campaign reminding taxpayers of the obligation to submit the prior communication regarding the Country-by-Country Report (CbCR). 

This reminder is issued due to the approaching close of the fiscal year: December 31st for most entities. Therefore, it is essential to confirm whether your organization is subject to this formal compliance requirement to avoid potential penalties. 

Who does this obligation apply to? 

This requirement applies to entities that are part of a Multinational Group with a consolidated global turnover of EUR 750 million or more in the preceding fiscal year.

The obligation specifically falls upon: 

• Resident companies in Spanish territory. 

• Permanent establishments of non-resident entities operating in Spanish territory. 

What is the “Prior Communication”? 

According to Article 13.1 of the Corporate Income Tax Regulations, Spanish entities (or permanent establishments) belonging to these large groups must inform the AEAT. The required information includes the identity and tax residence of the entity that will file the group’s global report. 

This obligation corresponds to the “CbC Notification” established under OECD BEPS Action 13 and EU Directive 2016/881 (DAC4). When communicating with your Group’s headquarters, it is best to refer to it as the “CbC Notification” or “Notification of the Reporting Entity”. 

• Deadline: it must be submitted before the end of the tax period. For fiscal years coinciding with the calendar year, the deadline is December 31, 2025. 

Verifications with the Head Office

To determine if your entity must perform this procedure, it is necessary to carry out the following steps directly with your group’s parent company (global tax department). This is because it involves consolidated information that is typically not available at the local level: 

1. Threshold Validation (Parent): request confirmation from your parent company as to whether the group’s consolidated turnover exceeded €750 million in the previous fiscal year. 
2. Identification of the Reporting Entity (Parent): if the threshold is exceeded, confirm which group entity will file the Country-by-Country Report with its respective tax administration and in which country or territory it has its tax residence. 
3. Local Instruction: once this information is obtained from your parent company, please forward it as soon as possible in order to proceed with the electronic filing of the prior communication form with the AEAT. 

Conclusion 

Failure to submit this prior communication, or filing it past the deadline, may result in tax infringements. Therefore, it is advisable to have a local partner who understands Spanish legislation to avoid any issues in the management of your multinational group located in Spain. 

At TPS by Auxadi, we remain at your full disposal to assist you in analyzing this obligation or in filing the corresponding model once the information has been received from your parent company. 

At Auxadi, we offer comprehensive services in accounting, tax, payroll, transfer pricing and corporate legal services to multinationals and funds. With experience since 1979 and a presence in over 50 countries, including 26 proprietary subsidiaries, our advanced technological platform and proven methodology enable us to guarantee efficient management in compliance with local regulations.