Israel: Information regarding controlled transactions and documentation
According to the Art. 57 of Act 90/2003, parties are considered as related if they are part of a group under Art.2 Act 3/2006. The majority of shares is owned, directly or indirectly, by two or more legal entities within the group or they are
See MoreIceland enacted its own transfer pricing legislation
Iceland has recently enacted its own transfer pricing legislation, which became effective from January 1, 2014. The transfer pricing rules are now regulated by Article 57 of Act No. 90/2003 on Income Tax based on the arm's length standard. There
See MoreRussia: Ministry of Finance clarifies the transfer pricing rules
The Ministry of Finance Letter No. 03-01-18/53941, issued on 10 December 2013, clarifies the rules to determine the income for controlled transactions purposes. The Ministry of Finance specified that transactions defined in article 105.14 of the Tax
See MoreColombia: Thin capitalization provision
Under the Decree 3027 of 27 December 2013, the thin capitalization provisions interest is fully deductible up to a debt to equity ratio of 3:1. This applies to domestic and foreign loans from related or unrelated
See MoreVietnam releases circular on treaty benefit application
Recently, Vietnam issued Circular 205 providing rules on the applicability of tax treaty benefits and general anti-abuse provisions (GAAR) which will become effective 6 February 2014. The main changes in Circular 205 from the previous circular are
See MoreNorway reduces corporate tax rate and enacts interest deductibility restrictions
On 13 December 2013, the newly proposed Norwegian interest deduction limitation rules were adopted by the Norwegian Parliament and the reduction of the corporate income tax rate from 28 to 27 % was adopted. The interest deduction limitation rules
See MoreUnited Kingdom: Dispute resolution, CFC financing, investment “white list”
HM Revenue & Customs have updated some key documents regarding resolution of tax disputes, and have provided new guidance on CFCs. The dispute resolution documents are the Code of Governance for resolving tax disputes; and Commentary on the
See MoreIndia – Arm’s length price for sourcing support services
The Delhi High Court has held that the Transfer Pricing Officer’s determination of an arm’s length price based on a 5% markup of the “free on board” (FOB) value of goods sourced for a related party’s contract with third parties was
See MoreIndia: Determines guarantee rates on loans are arm’s length
The Mumbai Bench of the Income-tax Appellate Tribunal held that bank guarantee rates cannot be mechanically applied in determining the arm’s length price. The tribunal explained the difference between corporate guarantee and bank guarantee, and
See MoreRussia–Readjusting the taxable base for transfer pricing purposes may impact on the VAT base
The Russian Ministry of Finance has made public Letter No. 03-01-18/19214 clarifying the rights of tax authorities to readjust the taxable base in the case of selling goods and performing of works or services between related parties. Article 105.3
See MoreRussia-Applicable fields for applying thin capitalization rules
The Ministry of Finance has published Letter No. 03-08-05/23521 regarding the applicability of the thin capitalization rules to interest payments made by a Russian company on a loan granted by a Russian bank issued on June 21, 2013. For example, a
See MoreIndia: Determines arm’s length price of share transfers
The Income-tax Appellate Tribunal has held that the discounted cash flow method was preferable over the “yield” method or “net asset value” method for purposes of determining the arm’s length price of shares transferred to related parties.
See MoreRussia- Court rules for establishing thin capitalization to a sister company loan
Russia’s Federal Arbitration Court of the North-West region has issued Ruling No. А52-4072/2012 on September 18, 2013 concerning the establishment by a sister company of thin capitalization rules to a loan issued. Russian court practice already
See MoreIndia – Implications of GAAR from 2015
Recently, in India general anti-avoidance rule (GAAR) has been introduced which will become effective from 1 April 2015 (Financial Year 2015-16). The rules for application of the GAAR provide certain exceptions which clarify that the GAAR will not
See MoreIndia: CBDT issues rules for application of GAAR
The government of India has allotted a General Anti Avoidance Rule (GAAR) in order to combat tax avoidance. The GAAR which was originally introduced in the 2012/13 budget will be effective from 1 April 2016. The Rules are applicable for tax years
See MoreGreece: Current transfer pricing legislation changes
Recently, major transfer pricing regulation changes have taken place in Greece. A bill was approved on 29 August 2013 by the Greek Parliament to expand the deadline for disclosing to the tax authority the inter-company transactions within a group
See MoreBrazil: Changes to transfer pricing regulations
Brazil issued Normative Instruction 1,395/2013 on 30 September 2013.This Instruction introduced changes to Normative Instruction 1,312/2012 regarding the prices that must be used in cross-border transactions involving the sale and purchase of goods,
See MoreAustralia: Liabilities classification for Thin Capitalization
As a consequence of changes to Australia’s thin capitalization rules taxpayers may need to review their thin capitalization position. Now every entity must have to consider whether their liabilities are debt or non-debt and the effect on the
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