| UK: | Secondary adjustment: HMRC launched a consultation on May 26, 2016 to introduce and design secondary adjustment rule into the transfer pricing legislation of UK. See the story in Regfollower |
| Germany: | BEPS related compliance General rule for CbC reporting: The German Finance Ministry released a draft law on June 1, 2016 proposing measures combating multinational profit shifting, including implementation of transfer pricing documentation and country-by-country reporting. If the draft law is passed by the parliament, it will come into force from January 1, 2016. See the story in Regfollower |
| Japan: | BEPS related compliance Penalty for failure to submit the CbC report or the Master File: The penalty for failure to submit the CbC report or the Master File by the respective deadline is up to a maximum of JPY300,000. This penalty can be levied on the representative, proxy or responsible employee, and additionally on the company itself. See the story in Regfollower |
| Austria: | BEPS related compliance Master file information: The Austrian Ministry of Finance (MoF) has published draft legislation to implement the Master File in line with the new OECD standard. All entities belonging to a MNE group that are tax resident in Austria would have to prepare a Master File. The Master File would provide comprehensive information of the MNE group. Austrian entity would be exempt from the Master file documentation requirement if it has a turnover equal to or below €50 million or intra-group sales commission equal to or below €5 million. Local file information: Austria has proposed draft legislation to introduce local file requirement as per the recommendations of the OECD’s base erosion and profit shifting (BEPS) Action 13. A local file will contain specific transfer pricing information for each relevant country of operation. General rule for CbC reporting requirement: The Austrian Ministry of Finance (MoF) has published draft legislation to introduce the country-by-country reporting rules pursuant to the OECD’s three-tier transfer pricing documentation approach for the fiscal years starting on or after 1 January 2016. Multinational Enterprises (MNEs) or a local subsidiary with a global consolidated group turnover exceeding €750 million in the previous year would be required to submit country-by country reports containing the information in Annex III of the OECD’s BEPS Action 13 final recommendations. Penalty for non-compliance: The published draft legislation of Austria has proposed a maximum penalty of €80,000 if the CbC reporting requirements are not met. The Austrian draft legislation does not include any penalties for the Master File and the Local File. See the story in Regfollower |
| Greece: | Documentation requirement: The Public Revenue Authority published a legal document providing clarifications that the acquiring company is responsible for the submission of the relevant transfer pricing documentation with respect to transactions that have taken place after the preparation of the merger balance sheet and the final registration of the merger decision in the Business Register. See the story in Regfollower |
| Germany: | BEPS related compliance General rule for CbC reporting requirement: The German Ministry of Finance published a draft bill on June 1, 2016 to incorporate guidance on transfer pricing documentation and country-by-country (CbC) reporting into local legislation. The draft bill required multinationals with consolidated group turnover of EUR 750 million to file an annual country-by-country report (CbCR). The law shall be passed by the parliament by the end of the year so that the new regulation can come into force from 2016. Master file information: The German Ministry of Finance published a draft bill on June 1, 2016 to prepare master file for all entities with gross receipts (third party and inter-company) of at least €100m in the previous financial year. The law shall be passed by the parliament by the end of the year so that the new regulation can come into force from 2016. See the story in Regfollower |
| Costa Rica: | Specific transfer pricing compliance: The Costa Rican tax authority released a draft rules on 6 June 2016 for taxpayers to apply and follow in filing an annual transfer pricing return. The draft resolution includes a penalty for taxpayers that fail to file a transfer pricing return, with the penalty amount being equivalent to 2% of the taxpayer’s gross income for the previous fiscal year. See the story in Regfollower |
| Australia: | BEPS related compliance Penalty for non-compliance: The Government of Australia proposed revised penalties amounting to AUD450, 000 from 1 July 2017 for failure to adhere to tax disclosure obligations like non submitting of local file. See the story in Regfollower |
| Singapore: | BEPS related compliance General rule for CbC reporting: The Ministry of Finance has announced that Singapore is planning to implement Country-by-Country Reporting (CbCR) for financial years beginning on or after 1 January 2017 for multinational enterprises whose ultimate parent entities are in Singapore and whose group turnover exceeds SGD 1,125 million. The CbC report is required to file with the Inland Revenue Authority of Singapore (IRAS) within 12 months from the last day of the financial year. See the story in Regfollower |
| Belgium: | BEPS related compliance Master file information: The Government of Belgium has approved new draft legislation to implement the Master File in line with the new OECD & UN standard. All entities belonging to a MNE group that are tax resident in Belgium would have to prepare a Master File. The Master File would provide comprehensive information of the MNE group. The Master file would have to be filed with the Belgian tax authorities within a period of 12 months after the close of the reporting period of the group. Local file information: The Government has approved new draft legislation to introduce local file requirement as per the recommendations of the OECD’s base erosion and profit shifting (BEPS) Action 13. A local file will contain specific transfer pricing information for each relevant country of operation. General rule for CbC reporting requirement: The Government of Belgium has approved new draft legislation to introduce the country-by-country reporting rules pursuant to the OECD & EU documentation provisions. If the Belgian Parliament approves this legislation, qualifying Belgian companies and establishments will have to comply with these new requirements for financial years starting on or after 1 January 2016. Qualifying groups with a consolidated gross turnover exceeding €750 million would have to file the CbC report with the Belgian tax authorities within 12 months after the closing of the consolidated financial statements of the group. See the story in Regfollower |
| Tanzania: | Primary adjustment: Adjustments made by the Commissioner for non-compliance with the arm’s length principle between associates for transfer pricing purposes will apportion and allocate the expenditure based on a comparability analysis. See the story in Regfollower |
| Pakistan: | Main corporate tax rate: The fiscal Budget for 2016 has proposed to reduce 32% corporate tax rate to 31% form 1 July, 2016.
BEPS related compliance |
Transfer Pricing Brief: June 2016
29 June, 2016
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