Mexican Tax Authorities issued proposed regulations regarding the “additional information” that could be requested as part of the new transfer pricing obligations, which require Mexican taxpayers to submit a master file, local file and country-by-country (CbC) report on 17 October 2016.
In the case of the consolidated financial statements of the MNE, the proposed regulations regarding the “additional information” that could be requested as part of the new transfer pricing obligations, would not provide flexible deadlines, if the book year closing of the foreign head office differs from the calendar year. As mentioned, the proposed regulations would require very detailed information to be included in the master file.
The proposed regulations regarding the “additional information” that could be requested as part of the new transfer pricing obligations, would require more detailed information (than established in Chapter V of the OECD TP Guidelines) for purposes of the local file. For instance, the proposed regulations would require taxpayers to submit copies of all legal agreements concluded between related parties, while the OECD TP Guidelines only call for the “material” agreements.
As a result of the public comment process, the proposed regulations may change. Taxpayers should carefully monitor such changes and start preparing to gather calendar year 2016 information as soon as possible to ease compliance with these new requirements, even though the information has to be presented at the end of 2017.
