On the basis of Federal Law No. 379-FZ, the amendments has made in transfer pricing (TP) rules and it was issued on 29th November 2014. This amendments to TP rules have entered into force on 1st January 2015. The important changes are given below:

  • The enlisted controlled transactions given in article 10514 of the Tax Code is prolonged and if one of the parties is a resident of a special economic zone or a free economic zone in the territory of Crimea and Sevastopol City then this counts also related party transactions whereas the other party doesn’t have such type of status. If the total income from these transactions crosses RUB 60 million per calendar year then it should be in the scope of controlled transactions.
  • Provided by article 269 of the Tax Code, the limit rules for the deductibility of interest costs have been amended. The taxpayer is obliged to verify the interest expenses only in respect of controlled transactions regarding transfer pricing aspects, except when one of the parties is a bank. In this situation, the taxpayer has the right to apply a safe harbour range for interest rates that be subject to on the debt’s currency. However, the lender will have the authority to introduce the interest calculated on the debt obligation at the actual rate as income if that rate higher than the lowest value of the threshold values range provided by article 269 (1.2) of the Tax Code, while the borrower will have the authority to introduce interest calculated on the debt obligation at the actual rate as an expense if that rate is smaller than the highest value of the same threshold values boundary. When one of the parties is a bank, the interest introduced by the taxpayer needs to be determined consider transfer pricing provisions.
  • Rules of transfer pricing for the purpose of determining the securities’ market price on transactions with listed securities may apply if the buyer of the securities with its affiliated parties becomes a more than 5% holder of the securities issued, the charge of the securities is established by the state authorities or local governments; and the seller of the securities is also the issuer of these securities.