New rules define reporting requirements for multinational enterprise groups, including the €750 million consolidated revenue threshold and information required for international tax transparency.

ISLAMABAD: The Federal Board of Revenue (FBR) has updated country-by-country (CbC) reporting requirements for Tax Year 2027, specifying the documentation and information that certain taxpayers must maintain and furnish to tax authorities.

The FBR issued the Income Tax Rules, 2002, updated up to September 15, 2026, for the tax year covering July 1, 2026, to June 30, 2027.

Under Rule 27A, the provisions apply to sub-sections (3) to (5) of Section 108 of the Income Tax Ordinance, 2001. The rules prescribe documents, records, information and reports that specified taxpayers must maintain and provide to the FBR and the Commissioner.

The rules primarily cover multinational enterprise (MNE) groups with annual consolidated revenue of at least €750 million, or its equivalent in Pakistani rupees, during the fiscal year immediately preceding the reporting year.

A country-by-country report must provide financial and operational information for each jurisdiction where an MNE group operates. This includes revenue, profit or loss before income tax, income tax paid and accrued, stated capital, accumulated earnings, employee numbers and tangible assets.

The report must also identify each constituent entity, its country of incorporation and tax residence, and describe its principal business activities.

Rule 27A further defines key terms, including ultimate parent entity, surrogate parent entity, reporting entity, related party and competent authority agreement.

The framework supports international tax information exchange and strengthens transparency regarding the cross-border operations and tax affairs of multinational businesses.