The Ministry of Finance has published new guidance on the contents of transfer pricing documentation (TPD) on August 20, 2014 that requires changes for most taxpayers. This alert summarizes the transfer pricing legislative developments as well as recent transfer pricing audit experience in Slovakia. The guidance is effective immediately for tax periods beginning on January 1, 2014 and later.
The requirements regarding transfer pricing documentation usually follow OECD Transfer Pricing Guidelines and the EU Code of Conduct. When taxpayers perform transactions with related parties recognized in a non-contracting state, apply for an APA, or need secondary adjustments for the purposes of making the transfer pricing documentation, then they are deemed as companies that are compelled to keep their local accounting books according to the IFRS. In such cases, taxpayers are needed to make a complete documentation. It is predictable the new documentation requirements will bring more proficient transfer pricing audits and decrease the burden for those taxpayers whose transfer pricing complies with the arm’s length principle.
