Limitations on the use of CbCR reports: New changes effective July 1, 2026

The limitations on the use of CbCR reports are one of the notable points. Decree 255/2026/ND-CP Effective from July 1, 2026, this Decree replaces Decree 132/2020/ND-CP on tax management for enterprises with related-party transactions. A key new feature of the Decree is the clarification of the scope of use of the Country-by-Country Report (CbCR) in tax management, while also adding a provision prohibiting its use for adjusting or fixing related-party transaction prices.

For multinational corporations, correctly understanding the limitations of using the CbCR report is crucial not only for compliance with legal regulations but also for preventing misunderstandings about its role in audits, inspections, and risk management related-party transactions. In this article, MAN – Master Accountant Network will analyze the regulations in Decree 255/2026/ND-CP, and compare them with Decree 132/2020/ND-CP and... Decree 20/2025/ND-CP to help businesses understand New points in Decree 255/2026/ND-CP, The deadline for submitting the CbCR report and important notes on fulfilling obligations regarding related-party transactions.

What is a CbCR report?

The Country-by-Country Report (CbCR) is one of the components of the documentation required to determine transfer pricing for certain companies within multinational corporations.

The Corporate Income Tax Review (CbCR) is designed to provide tax authorities with a comprehensive overview of a corporation's global operations through aggregated information broken down by country or region in which the corporation operates. The report includes indicators such as revenue, profit, corporate income tax paid, capital, labor, tangible assets, and other relevant information as required by regulations.

Objectives of the CbCR Report:

• Enhancing transparency in the operations of multinational corporations;
• Assisting tax authorities in carrying out risk management tasks;
• And exchange information in accordance with international commitments on taxation.

The CbCR report is a crucial tool for tax management for businesses with related-party transactions. However, businesses also need to understand the limitations of using the CbCR report to avoid inaccurate perceptions of its legal value.

Why should businesses with related-party transactions be concerned about the usage limits of the CbCR report?

For businesses with related-party transactions, simply knowing that they must prepare or submit the CbCR report is not enough. More importantly, they need to correctly understand the scope and purpose of the report as required by law.

First and foremost, the CbCR report is a valuable data source for tax authorities in assessing the risks of related-party transactions. Through aggregated information by country, tax authorities can analyze and identify risk indicators and facilitate information exchange with foreign tax authorities in accordance with international tax treaties and commitments.

However, businesses should also note that the limitations on the use of the CbCR report are clearly stipulated in Decree 255/2026/ND-CP. Accordingly, this report is not a document used to adjust or determine the price of related-party transactions. This regulation clarifies the role of the CbCR in the related-party transaction documentation system and helps businesses understand the correct scope of its use in tax management.

Furthermore, understanding the limitations of using the CbCR Report helps businesses prepare complete and consistent related-party transaction documentation across various documents such as the National File, Global File, and the CbCR Report. Data consistency not only supports legal compliance but also enables businesses to be more proactive when tax authorities conduct risk management activities or request information as required by regulations.

See also: Full text of Decree 255/2026/ND-CP.

Limitations on the use of CbCR reports according to Decree 255/2026/ND-CP

From July 1st, 2026, regulations regarding the limitations on the use of the CbCR report will be implemented according to Article 20 of Decree 255/2026/ND-CP. Compared to previous regulations, this content has been adjusted to clarify the scope of use of the Country-by-Country Profit Report (CbCR) in tax management for enterprises with related-party transactions.

Understanding the limitations of using the CbCR Report is crucial for businesses, as it forms the basis for correctly understanding the report's role in the related-party transaction documentation system and prevents misunderstandings about the legal value of this document.

Legal basis for limiting the use of CbCR reports.

Regulations regarding the limitations on the use of the CbCR Report are stipulated in point c, clause 1, Article 20 of Decree 255/2026/ND-CP on the responsibilities and powers of tax authorities in managing transfer pricing.

According to regulations, the tax authorities are responsible for:

• Applying risk management in tax administration to transfer pricing in accordance with tax laws.
• Managing and utilizing taxpayers' country-by-country profit reports serves risk management and information exchange purposes in accordance with Vietnam's regulations and commitments under international tax agreements.

At the same time, the Decree clearly stipulates that it cannot be used to adjust or fix the price of related-party transactions.

This is a key point businesses need to pay special attention to when understanding the limitations on using CbCR reports under the new regulations.

What is the purpose of using the CbCR report?

According to Article 20 of Decree 255/2026/ND-CP, the Country-by-Country Report is managed and used by the tax authorities for the following purposes:

• Serving the purpose of risk management in tax administration regarding transfer pricing.
• To facilitate information exchange in accordance with regulations and Vietnam's commitments under international agreements on taxation.

It can be seen that these uses are all aimed at assisting tax authorities in the process of risk assessment and fulfilling international cooperation obligations on taxation. The regulation does not specify that the CbCR report is a direct basis for determining the transfer pricing of a business.

Clearly defining the purpose of use also helps ensure that the limits on the use of the CbCR report are consistent with the nature of this type of report in the international tax administration system.

Why has the scope of use for CbCR reports been expanded?

From a professional perspective and with experience in related-party transactions, MAN – Master Accountant Network recognizes this addition as having significant practical implications. Previously, the "not to be used for tax assessment" provision in Decree 132/2020/ND-CP only prevented tax authorities from using the CbCR as a direct basis for calculating the tax payable. However, theoretically, tax authorities could still use the profit allocation data in the CbCR as a reference to adjust the price of related-party transactions.

The addition in Decree 255/2026/ND-CP, specifically stating that it "should not be used to adjust or determine the price of related-party transactions," has significantly narrowed this scope. In other words, the limitations on the use of the CbCR report now encompass the process of adjusting the price of related-party transactions, not just the final result of the assessed tax amount.

This is seen as a step forward in protecting the legitimate rights of taxpayers, and is also more in line with international practices regarding the use of CbCR, which the OECD recommends should only be used for overall risk assessment purposes and not as direct evidence to adjust the transfer pricing of individual transactions.

Comparison between the new and old regulations regarding the usage limits of CbCR reports.

To help businesses better understand the overall roadmap for amending laws related to related-party transactions and CbCR, the table below compares Decree 132/2020/ND-CP, Decree 20/2025/ND-CP, and Decree 255/2026/ND-CP based on key criteria:

Note: The content related to Decree 20/2025/ND-CP is presented to provide businesses with a clear overview of the roadmap for amending the law on related-party transactions. This Decree does not directly amend the clause on the limitations on the use of the CbCR Report; therefore, the corresponding column is marked as "unchanged" compared to Decree 132/2020/ND-CP.

What benefits do businesses gain from the new limitations on the use of CbCR reports?

For multinational corporations with a parent company in Vietnam or with subsidiaries subject to the CbCR reporting requirement, expanding the scope of CbCR reporting offers several notable practical benefits:

• Firstly, businesses reduce the risk of tax authorities using aggregated global profit data from the CbCR as a direct basis for adjusting transfer pricing in Vietnam. In previous audits and inspections, the line between "reference" and "use" as a basis for adjustment was sometimes not entirely clear. The new regulations in Decree 255/2026/ND-CP help to narrow this ambiguity.
• Secondly, the clearer regulations on the use of the CbCR report also mean that businesses have a stronger legal basis to argue against tax authorities citing CbCR data as a basis for adjusting transfer pricing during audits and inspections.

However, businesses should also note that CbCR still plays a crucial role in the tax authorities' risk management. An unusual profit allocation structure across countries could potentially lead tax authorities to conduct a thorough review of the company, even if it is not directly used to adjust transfer pricing.

Therefore, the limitations on the use of the new CbCR report do not mean that businesses can neglect to build a complete, independent, and consistent transfer pricing profile that matches the data declared in the CbCR.

Businesses should consider this. related party transaction advisory services In-depth assessment to evaluate the specific impact of the new CbCR Report usage limitations on current or potential audit and inspection records. 

What preparations do businesses need to make before the new regulations limit the use of CbCR reports?

To fully utilize the spirit of the new regulations while ensuring compliance, businesses should:

• Review all related-party transaction pricing documentation (including national and global documentation) to ensure its independence and completeness.
• Verify the consistency between the data published in the CbCR and the data presented in the Local File and the Master File to avoid discrepancies that could lead to the tax authorities placing the entity under high-risk management.
• Update internal procedures for collecting and aggregating consolidated financial data to ensure timely and accurate preparation of the Consolidated Balance Sheet (CbCR) in accordance with new regulations.

For businesses that do not yet have a complete set of documents or need to standardize them according to the new regulations, they may consider using this service. related party transaction documentation service From specialized and experienced units such as MAN – Master Accountant Network to ensure the legality and consistency of the declared CbCR data.  

Deadline for submitting CbCR according to Decree 255/2026/ND-CP

In parallel with clarifying the limitations on the use of the CbCR Report, Decree 255/2026/ND-CP also specifies the responsibility for submitting the CbCR in Clause 1, Article 19. Accordingly, businesses need to pay special attention to several points:

• Deadline for submission: Country-by-country profit reports must be submitted no later than 12 months from the end of the fiscal year of the ultimate parent company for the reporting year.
• Submission format: CbCR must be submitted in encrypted XML format. This is a technical requirement that businesses need to prepare the appropriate systems and software to meet.
• Submission channel: Notifications and CbCRs are submitted through the Tax Management Information System, instead of being submitted directly in paper form as with some other traditional administrative procedures.
• Consolidated revenue threshold exchange rate: Determined according to the central exchange rate or the cross-average exchange rate of December of the year preceding the reporting year, as published by the State Bank of Vietnam.

Understanding both the deadline for submitting and the limitations on the use of the CbCR report helps businesses proactively plan for compliance, avoid late submissions leading to penalties, and correctly understand their rights when tax authorities conduct audits or inspections of related-party transactions.

Conclude

The limitations on the use of the CbCR report are one of the points clarified in Decree 255/2026/ND-CP, effective from July 1, 2026. According to current regulations, the Country-by-Country Profit Report is managed and used by tax authorities for risk management and information exchange in accordance with international tax regulations and commitments; it is not used to adjust or fix the price of related-party transactions.

For businesses with related-party transactions, understanding the limitations on the use of the CbCR report is crucial not only for correctly understanding its role in the documentation system for determining transfer pricing but also for improving compliance with legal regulations. Simultaneously, businesses should regularly update themselves on the new regulations of Decree 255/2026/ND-CP to prepare complete, consistent, and compliant related-party transaction documentation that meets the requirements of the tax authorities.

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Responsible for production and professional content review by: Mr. Le Hoang Tuyen – Founder & CEO of MAN – Master Accountant Network. He is a CPA Vietnam auditor with over 30 years of in-depth experience in accounting, auditing, taxation, and corporate legal consulting.

Frequently Asked Questions about the Usage Limits of CbCR Reports