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Master file instructions


As a CBC reporting entity, you are required to lodge a master file within 12 months of the end of your income year.

Last updated 3 November 2022

Overview

The master file should reflect the facts and circumstances existing in the income year or replacement reporting period of the reporting entity. The master file and its contents must be in English when lodged in Australia.

The master file is a statement relating to your global operations and activities, and the pricing policies relevant to transfer pricing of you and the other members of your multinational enterprise (MNE) group. The specific information that must be included in the master file is as described in Annex I of the Action 13 final reportExternal Link. The descriptions of the 5 sections of the master file are reproduced below.

Organisational structure

Provide a chart illustrating your MNE's legal and ownership structure and the geographical location of operating entities.

Description of the MNE's business

Provide a general written description of your MNE’s business, including the following.

  • Important drivers of business profit.
  • A description of the supply chain for the group’s 5 largest products or service offerings by turnover plus any other products or services amounting to more than 5% of group turnover. The required description could take the form of a chart or a diagram. Note: When categorising or delineating products or services, the entity may use any categorisation of products or services that is reasonable having regard to commercial or industry practices and differences in supply chains for those products or services within the group.
  • A list and brief description of important service arrangements between members of the MNE group, other than research and development (R&D) services, including a description of the capabilities of the principal locations providing important services and transfer pricing policies for allocating services costs and determining prices to be paid for intra-group services.
  • A description of the main geographic markets for the group’s products and services that are referred to in the second bullet point above.
  • A brief written functional analysis describing the principal contributions to value creation by individual entities within the group – that is key functions performed, important risks assumed, and important assets used.
  • A description of important business restructuring transactions, acquisitions and divestitures occurring during the fiscal year.

MNE's intangibles

Provide a:

  • general description of the MNE’s overall strategy for the development, ownership and exploitation of intangibles, including location of principal R&D facilities and location of R&D management
  • list of intangibles or groups of intangibles of the MNE group that are important for transfer pricing purposes and which entities legally own them
  • list of important agreements among identified associated enterprises related to intangibles, including cost contribution arrangements, principal research service agreements and licence agreements
  • general description of the group’s transfer pricing policies related to R&D and intangibles
  • general description of any important transfers of interests in intangibles among associated enterprises during the fiscal year concerned, including the entities, countries, and compensation involved.

For these purposes 'intangible property' includes rights to use industrial assets such as patents, trademarks, trade names, designs or models. It also includes literary and artistic property rights and intellectual property such as know-how and trade secrets.

MNE's intercompany financial activities

Provide:

  • a general description of how the group is financed, including important financing arrangements with unrelated lenders
  • the identification of any members of the MNE group that provide a central financing function for the group, including the country under whose laws the entity is organised and the place of effective management of such entities
  • a general description of the MNE’s general transfer pricing policies related to financing arrangements between associated enterprises.

MNE's financial and tax positions

Provide:

  • the MNE’s annual consolidated financial statement for the fiscal year concerned if otherwise prepared for financial reporting, regulatory, internal management, tax or other purposes
  • a list and brief description of the MNE group’s existing unilateral advance pricing agreements (APAs) and other tax rulings relating to the allocation of income among countries.

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