A draft amendment to income tax law in Slovakia contains provisions regarding changes to the rules for transfer pricing and thin capitalization. The amendment was accepted on August 2014, and if enacted, the changes usually would have an effective date of January 1, 2015. According to proposed legislation, new rules would be applicable for Slovak taxpayers related to other Slovak taxpayers. These taxpayers would be needed to make transfer pricing documentation. If the documentation were not submitted within 15 days after a request of production, taxpayers would be faced frequent penalty assessment of up to €3,000. The proposal would expand thin capitalization rules application to all legal entities (except banks, insurance companies, reinsurance companies and their Slovak branches, and collective investment companies) that are related parties. According to the legislative proposals, interest more than 25% of the value of the pointer calculated as profit or loss before tax on the basis of the local accounting rules or IFRS.thin
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