The Ministry of Finance (MoF) published the amendment of Transfer Pricing Audit Rules on 13th November 2017. The rules established three-tiered transfer pricing documentation in accordance with the OECD under the base erosion and profit shifting (BEPS) Action 13.
Master file:
According to amendment of transfer pricing audit rules, a multinational profit-seeking enterprise (MNE) with annual revenue and related party transactions above the stipulated threshold (which will be declared later by the MoF) is required to deliver its master file to the tax authorities by 31st December after the end of each fiscal year.
Local file:
According to the draft change in transfer pricing guidelines for the public consultation, published on 27th July 2017, taxpayers are required to prepare a local file if the total annual revenue (including current and non-operational revenue) exceeds TWD 500 million. The local file must be completed with the annual income tax return by 31st May after the end of each tax year. Upon request, taxpayers must submit the documents within one month of receipt of the notification, but in special circumstances, have a one-time extension of an additional month.
