Poland: Financial services-Restriction on interest deduction: According to draft bill revising on corporate income tax act published on 12 July 2017, thin capitalization rules limiting the deduction of financing costs to 30% of an adjusted tax basis.
See the story in Regfollower
Iceland: Restriction on interest deduction: On 1 June 2017, the Icelandic Parliament passed legislation amending the interest limitation rules.
See the story in Regfollower
Panama: APAs-Availability of APA: The Tax Authorities (Direccin General de Ingresos, DGI) recently given for consultation a bill amending article 762-L of the tax code to introduce advanced pricing agreements (APAs) to the transfer pricing regime.
See the story in Regfollower
Greece: BEPS related compliance-CbC reporting requirement: According to the draft law 20 July 2017, containing modifications to the Greek Corporate Income Tax L.4170/2013 and 4474/2017, the Country-by-Country (CbC) reporting requirements will be applicable for fiscal years starting on or after 1 January 2016.
BEPS related compliance-Timing: The report is required to be provided to the tax authorities within 15 months after the last day of the tax year it refers to.
BEPS related compliance-Penalty for non-compliance: According to the draft law 20 July 2017, the proposed penalty for non-submission of the CbC report is €10,000. With respect to the late submission or submission of inaccurate information, the penalty is €5,000.
See the story in Regfollower
Belgium: Information exchange-Multilateral: The federal government submitted a draft bill, providing implementing rules of DIRECTIVE 2015/2376/EU of 8 December 2015 amending the Mutual Assistance Directive [on administrative cooperation in the field of taxation] (2011/16).
See the story in Regfollower
Netherlands: Restriction on interest deduction: On 10 July 2017, a public (internet) consultation was launched by the Dutch Ministry of Finance on the implementation of the European Anti-Tax Avoidance Directive 2016/1164 (ATAD). The consultation document covers the EBITDA based interest deduction limitation rule.
See the story in Regfollower
Czech Republic: CbC reporting requirement-General rule: According to amending proposals passed by the chamber of deputies on 12 July 2017, the CbC report will be mandatory for multinational groups with an annual consolidated turnover exceeding €750 million.
See the story in Regfollower
Cyprus: Intra-group services-General rule: The Circular of 30 June 2017 defines intra-group financing transactions as all activities of granting loans or advances to related entities remunerated by interest (or should be remunerated by interest) and funding them through public debt issuance, private loans, advances, or bank loans, among others.
See the story in Regfollower
Italy: Adjustments-Corresponding adjustment: According to article 59 of Law Decree no. 50/2017, a corresponding downward adjustment resulting in lower taxable income will no longer be conditional on a mutual agreement procedure (MAP).
See the story in Regfollower
Thailand: Public comments regarding Draft Transfer Pricing Rules: The Revenue Department of Thailand is requesting public comments with respect to the Draft Transfer Pricing Rules which were approved by the Thai Cabinet on May 2015. The comments are to be provided by 7 July 2017.
See the story in Regfollower
Germany: Requirements: Accordin to CbC reporting requirements guidance issued on 11 July 2017, CbC reporting is effective for tax years starting after 31 December 2015.
Language: The country report can be submitted in English. The information or explanations contained in Table 3 of the BMF letter must be submitted in English, in accordance with Article 2b of Implementing Regulation (EU) 2015/2378.
See the story in Regfollower
Vietnam: Audit Process: According to the new Law No. 07/2017/QH14 effective from 1 July 2018, the tax authorities will exclude the costs of the technology transfer from deductible expenses if the technology transfer contract is not registered.
Audit Rules: According to Law No. 07/2017/QH14, the tax authorities may request the enterprises receiving the technology to provide the audited technology transfer dossiers and dossiers on how market prices were determined for the transferred technologies in order to determine the expenses deductible for corporate income tax calculation purposes.
Audit Process-Areas of scrutiny: Law No. 07/2017/QH14 stipulates that the technology transfer price must be audited and implemented in accordance with the tax and price law.
See the story in Regfollower
Comparable Data: According to Circular 41/2017, for benchmarking purposes, Vietnamese data should be prioritized but if not available, regional data can also be used if appropriate adjustments are made for factors such as location and cost differentials.
Comparability analysis: According to Circular 41/2017, if the taxpayer is outside the range, an adjustment will be made to the median.
CbC reporting requirement-General rule: Circular 41/2017 confirms that ultimate parent company in Vietnam should prepare CbCR if the consolidated revenue is VND 18 trillion or more.
Safe Harbour-Exemption from documentation requirements: Decree 20/2017 provides relief for small businesses and lists various exemptions that are available which includes taxpayers engaging in ‘simple’ functions with revenue less than VND 200 billion and achieving at least the following ratios of EBIT to sales on its respective business
See the story in Regfollower
Malaysia: Update the guidelines for transfer pricing: The Inland Revenue Board of Malaysia (IRBM) had recently announced new updates and changes to the Transfer Pricing Guidelines 2012 (“TPG 2012”).
See the story in Regfollower
US: Specific TP compliance: The Internal Revenue Service has recently released final versions of the form and instructions for filing country-by-country (CbC) reports. Form 8975 and its schedules can be filed in the modernized e-file (MeF) XML schema format. Parent entities not permitted to file returns electronically must file Form 8975 with their paper income tax return.
See the story in Regfollower
Slovenia: CbC reporting requirement-General Rule: On 16 June 2017, the ordinance on country-by-county (CbC) reporting was published in Official Gazette No. 30/2017. The CbC reporting form is expected to be available in July 2017. In principle, the CbC reports must be submitted within 3 months after the end of the tax year as additional documents on the ordinary corporation tax return.
See the story in Regfollower
Singapore: Requirement-Rule: According to the draft Income Tax (Amendment) Bill 2017 (Draft Bill) of 19 June 2017, Section 34D of the Singapore Income Tax Act (SITA) would be expanded to provide clarification on the meaning of arm’s-length conditions.
Documentation-Thresholds: According to the draft Income Tax (Amendment) Bill 2017 (Draft Bill) of 19 June 2017, the requirement to prepare TPD will only apply to businesses with turnover exceeding S$10 million. This S$10 million turnover serves as an additional safe harbour to the existing thresholds.
See the story in Regfollower
Information exchange-Multilateral: On 22 June 2017, Singapore signed the Multilateral Competent Authority Agreement (MCAA) on the automatic exchange of Country-by-Country (CbC) reports. The signing took place at a ceremony held during the third meeting of the inclusive framework on BEPS on 21–22 June 2017.
See the story in Regfollower
Romania: CbC reporting requirement-General rule: According to the new provisions passed on June 9 2017, a Romanian tax resident entity that is ultimate parent entity of an MNE Group with annual consolidated group revenue of €750 million and above will need to comply with the CbC requirements for fiscal years starting on or after 1 January 2016.
Penalty for non-compliance: For failing to file a CbC report, the penalty ranges from RON 70,000 to RON 100,000. For late filing of a CbC report or for incomplete/incorrect filing of the CbC report, the penalty ranges from RON 30,000 to RON 50,000.
See the story in Regfollower
France: Reduction of corporate tax rate: On 4 July 2017, the Prime Minister of France confirmed in his opening speech to the National Assembly that the Government would cut the corporate tax from 33 percent to 25 percent by 2022 with the hope of attracting Businesses.
See the story in Regfollower
Pakistan: Information Exchange-Multilateral: On 22 June 2017, Pakistan signed the Multilateral Competent Authority Agreement (MCAA) on the automatic exchange of Country-by-Country (CbC) reports. The signing took place at a ceremony held during the third meeting of the inclusive framework on BEPS on 21–22 June 2017.
See the story in Regfollower
Sri Lanka: Penalty for documentation failure: Sri Lankan companies that violate transfer pricing rules can be fined up to two percent of the total value of transactions between related parties in case of non-disclosure of any required information under the new tax law. The new law also contains the provision to impose a penalty of up to 1% of the total amount of transactions with related parties when they fail to comply with discloser requirements.
See the story in Regfollower