Cyprus Documentation-Local file/Master file: On 10 February 2023, the Cyprus Tax Department published a set of Frequently Asked Questions (FAQs) aiming to clarify certain provisions of the new transfer pricing rules approved in June 2022 with effect from 1 January 2022, including Local File and Master File.
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Germany Information exchange-Bilateral: On 9 February 2023, the German lower house of parliament (Bundestag) has approved a law to ratify the pending agreement with the USA on the exchange of CbC reports. The agreement was signed on 14 August 2020.
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Hungary Documentation-Thresholds: On 28 December 2022, the Hungarian Ministry of Finance published Decree 27/2022 (XII.28) which raised the threshold for TP documentation reporting requirement from HUF 50 million to HUF 100 million.
Master file/Local file: In previous years, the master file and the local file together formed one document for each tax year. However, as of tax year 2023, the master file and local file are considered separate documents, with the latter being created per transaction or per consolidated transaction.
Penalties for documentation failure: The default penalty for violating the TP documentation requirements increased from HUF 2 million to HUF 5 million per intercompany transaction. In the case of repeated violations, the maximum fine has been increased from HUF 4 million to HUF 10 million.
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India Documentation-Timing and deadlines: On 1 February 2023, the Finance Minister of India presented the Union Budget for 2023-24 to the Parliament. The time limit for submitting transfer pricing documentation and information has been reduced from 30 days to 10 days upon receiving a notice from a transfer pricing officer.
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Israel CbC reporting requirement-Deadlines: The Israeli Tax Authority (ITA) has recently released a new Notification Form 1585 for the disclosure of information related to Country-by-country reporting (CbCR). The notification should be filed as part of the tax return for the same fiscal year.
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Italy Digital economy transactions-General: On 23 February 2023, Italian Council of Ministers approved the legislative decree to implement new rules on the exchange of information on income generated through digital platforms (DAC7).
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Luxembourg CbC reporting requirement-General rule: On 24 February 2023, the Luxembourg government presented Bill no. 8158 to the Parliament to implement public Country-by-Country (CbC) reporting in compliance with Directive (EU) 2021/2101.
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Malaysia MAP: On 1 February 2023, the Inland Revenue Board of Malaysia (IRBM) has issued a list of frequently asked questions (FAQs) on the mutual agreement procedure (MAP) to provide further clarification to the 2017 MAP guidelines.
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Poland Filing deadlines: The Polish Ministry of Finance has announced a proposal to extend the filing and payment deadline for corporate income tax returns by three months, until 30 June 2023.
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Romania Digital economy transactions-General: On 31 January 2023, Romania published Ordinance No. 16/2023 in the Official Gazette, which transposes EU Council Directive No. 2021/514 (DAC7) into Romanian law to implement new rules on the exchange of information on income generated through digital platforms.
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Russia Information exchange-Multilateral: Recently, the Federal Tax Service of Russia published (Order No. ED-7-17/1226) a new list of foreign states and territories, with which Russia will automatically exchange Country-by-Country (CbC) reports.
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Spain Digital economy transactions-General: On 27 January 2023, Spain submitted a bill to Parliament for implementing Council Directive (EU) 2021/514 (DAC7), which requires digital platform operators to report the revenue generated by sellers on their digital platforms and for EU Member States to automatically exchange this information.
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Sweden Information exchange-Multilateral: On 2 February 2023, Sweden signed the multilateral competent authority agreement on the automatic exchange of information on income derived through digital platforms, according to an update published by OECD on 15 February 2023.
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Switzerland Safe harbour-Simplified interest rates: The Swiss Federal Tax Administration (SFTA) recently released Circular Letter No. 203 and Circular Letter No. 204 on 7 and 8 February 2023, respectively. These circulars provide safe harbor interest rates for intercompany loans and advances in Swiss francs and foreign currencies for the year 2023.
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Turkey Filing deadlines: On 16 February 2023, the Turkish Revenue Administration further announced emergency tax measures for the taxpayers located in Elazig due to earthquakes. Accordingly, taxpayers can submit their required declarations and notifications during the emergency tax measures period until 15 August 2023.
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Filing deadlines: On 8 February 2023, the Turkish Revenue Administration announced an emergency tax measure for taxpayers who were impacted by the earthquakes. Accordingly, taxpayers located in Adana, Adiyaman, Diyarbakir, Gaziantep, Hatay, Kahramanmaras, Kilis, Malatya, Osmaniye, and Sanliurfa are subject to emergency tax measures during the period between 6 February 2023 and 31 July 2023.
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UK Alternative dispute resolution: On 1 February 2023, UK HMRC published Alternative Dispute Resolution (ADR) Guidance with details of an alternative dispute resolution procedure. ADR in HMRC is a flexible process in which an impartial and neutral HMRC mediator actively assists parties in working towards resolving a tax dispute outside of the Tribunal or Court.
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APAs-General rules: On 7 February 2022 HMRC published the latest set of statistics relating to transfer pricing and the diverted profits tax. In 2021/22 HMRC agreed 20 transfer pricing-related advance pricing agreements (APAs). The average time to reach an agreement was 58.3 months.
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US Transfer pricing case: On 3 February 2023, the US Tax Court issued a rule approving an agreement between Eaton Corporation and the IRS to adjust Eaton’s tax bill for 2005 and 2006 to USD 8.8 million. The proposal stems from lengthy litigation in both the Tax Court and the Sixth Circuit Court of Appeals.
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