On 6 December 2012 it was published that the Irish Revenue released guidance on 26 November 2012 setting out how they are proposing to monitor transfer pricing compliance in accordance with Part 35A of the Taxes Consolidation Act 1997 The guidance released as “Revenue eBrief 62/12” introduces a new procedure referred to as the “Transfer Pricing Compliance Review” or “TPCR,” which will be a self-review carried out by the company / group of its compliance with the Regulations.
Ireland introduced transfer pricing regulations with effect for accounting periods beginning on or after 1 January 2011. The Regulations endorse the OECD Transfer Pricing Guidelines and adopt the arm’s length principle. The Regulations apply to any arrangement between associated enterprises involving goods, services, money or intangible assets, where the arrangement is regarded as a “trading transaction” within the charge to Irish tax at the corporate tax rate of 12.5%.
In addition to the statutory provisions relating to documentation contained within Part 35A, the Irish Revenue also released a guidance note entitled “Transfer Pricing Documentation Obligations” (Revenue eBrief 07/2010).
In summary, the guidance note states that transfer pricing documentation must be sufficient to demonstrate a Taxpayer’s compliance with the Irish regulations. For companies with a December 2011 year end, the first corporate tax returns for which transfer pricing documentation should be in place, were due to be filed on 23 September 2012.
