Belgium: | Main corporate income tax rate: On 27 October 2017, the government has approved the corporate tax reform bill. The rate of corporate income tax will be gradually reduced to 29% in 2018, and will be further reduce to 25% in 2020. Belgium will also grant a 100% participation exemption on dividends (current 95%) as of 1 January 2018. Capital gains on shares will also be 100% exempt as of 2018. See the story in Regfollower |
Hungary: | Master file-Information: On 18 October 2017, the Hungarian Ministry of National Economy (NGM) issued a decree on new Transfer Pricing Documentation rules. A group is required to prepare a master file from fiscal year beginning on or after 1 January 2018, if it has at least one member registered outside of Hungary. There is no specific threshold. If a taxpayer has to report any of its intercompany transactions, then the group has to prepare a MF. Master file-Reporting structure: The preparation deadline is 12 months after the end of the financial year and shall only be provided to the Hungarian tax authority upon request in case of an audit within a very short (usually 3-day) deadline. Local file: Local File reporting structure is generally in line with new Chapter V of OECD Transfer Pricing Guidelines but requires additional information. Every transaction or bunch of similar transactions exceeding the threshold of HUF 50 million has to be covered by the LF. See the story in Regfollower |
Oman: | Information exchange-Multilateral: Oman has joined the BEPS Inclusive Framework on 20 October 2017 at the third regional meeting took place in Bratislava (Slovak Republic) and committed to implement the four minimum standards of the BEPS package for actions 5, 6, 13 and 14. See the story in Regfollower |
Costa Rica: | CbC reporting requirement-General rule: According to draft resolution published on 26 October 2017, all Costa Rican tax resident entities that are part of a Multinational Enterprise (MNE) Group with consolidated group revenue of €750 million and above (or its equivalent in local currency) will need to comply with the CbCR requirements for the reporting fiscal (tax) year. CbC reporting requirement-Parent company: According to draft resolution published on 26 October 2017, a parent or controlling company means a Higher Level Dominant Entity of a group or multinational group that has directly or indirectly sufficient interest in one or more of the integrating entities of said group or multinational group and who must prepare consolidated financial statements in accordance with accounting standards. CbC reporting requirement-Timing: The CbC report must be submitted by the last business day of the 12 month after fiscal year end. The taxpayer must notify the identity of the reporting entity. This notification must be submitted no later than the last day of the reporting fiscal period of the multinational group. BEPS related compliance-Penalty for non-compliance: Failure to supply the information corresponding to the country-by-country report will be sanctioned in accordance with Article 83 of the Tax Standards and Procedures Code. See the story in Regfollower |
India: | Master file-Information: The threshold for the Master File is consolidated group revenue exceeding Rs. 500 crore and either the aggregate value of international transactions as per the books of accounts exceeding Rs. 50 crore or aggregate value of international transactions in respect of intangible property exceeding Rs. 10 crore. Master file-Reporting structure: Report of Master File has to be submitted in Form 3CEAA by the due date of filing the income-tax return i.e. 30th November following the financial year. CbC reporting requirement-General rule: Multinational groups where the ultimate parent company is a resident in India would be required to submit country-by country reports if the consolidated turnover exceeds INR 55,000 which is consistent with the OECD recommendation of €750 million. Report of the Country-by-Country Report in Form 3CEAD has to be filed electronically for each reporting year to the Director General of Income-tax (Risk Assessment). CbC reporting requirement-Timing: India-based IGs must submit the CbC report on or before the filing date of the income tax return i.e. 30 November following the financial year. As per the Indian final rules published on 1 November 2017, the CbC notification Form No. 3CEAC is required to be submitted electronically to the Director General of Income-tax (Risk Assessment). Penalty for non-compliance: As per the final rules published on 1 November 2017, failure to comply with the CbC report by the due date of submission of income tax return, compensation is INR5000 to INR50000 per day depending on the circumstances. See the story in Regfollower |
Sweden: | CbC reporting requirement-Profits and tax paid: According to the explanatory note No. 202 439672-17/111 published on 8 November 2017, the Swedish Tax Agency considers that the rate of return on pension funds that life insurance companies, foreign occupational retirement institutions and pension funds pay are to be regarded as income tax at country-by-country reporting. See the story in Regfollower |
Ukraine: | Control Transaction: On October 4, 2017, the State Fiscal Service (SFS) published Letter No. 1945/6 / 99-99-15-02-02-15 / IPK of September 13, 2017, which specifies the classification of transactions with a non-resident legal entity for the purpose of transfer pricing. If a non-resident legal entity is not registered as one of the business forms on the list published by Cabinet of Ministers of Ukraine, transactions with that non-resident legal entity are not deemed to be controlled at transfer pricing, unless the transaction meets the other criteria for controlled transactions in accordance with Article 39.2.1.1 of the TC. See the story in Regfollower |
Mexico: | Specific TP compliance: On 1 November 2017, the Mexican Tax Administration (SAT) released the online platform and digital formats for the new informative statements for taxpayers required to submit the new Transfer Pricing Informative Returns under Article 76-A of the Mexican Income Tax Law (MITL). See the story in Regfollower |
Pakistan: | CbC reporting requirement-Timing: On November 16, 2017, the Federal Board of Revenue (FBR) in Pakistan has issued SRO 1191(1)/2017, which inserts chapter VIA to the Income Tax Rules, 2002. According to SRO, an ultimate parent entity or surrogate parent entity must file the CbC report within a year after the end of the tax year of the group. The Deadline for tax year 2017 is March 31, 2018. See the story in Regfollower |
Taiwan: | Master file-Information: In accordance with the amendments to the transfer pricing audit rules published on 13 November 2017, a multinational profit-seeking enterprise (MNE) with annual revenue and related party transactions above the stipulated threshold (which will be announced later by the MoF) is obliged to deliver its master file to the tax authorities by 31 December after the end of each fiscal year. See the story in Regfollower |
Norway: | CbC reporting requirement-General: On 17 November 2017, the Tax and Customs Administration issued updated guidelines for submission of the form RF-1352 country-by-country reporting form (CbC). According to guidelines, CbC reports must be submitted by 31 December 2017. See the story in Regfollower |
Romania: | CbC reporting requirement-General: In Accordance with the order no. 3049/2017 released on14 November 2017, the “country-by-country reporting” form should be annually submitted, starting for the 2016 fiscal year, to the appropriate authority for the administration of the taxpayers which are required to submit this form within 12 months from the final day of the fiscal year of the group of which it is a member. See the story in Regfollower |
Peru: | Local file-Information: According to amendments made to Peru’s tax regulations on 17 November 2017, details of the minimum information to be recorded in the Local file, such as the identity of personnel on whom the taxpayer company’s management and administration depend. See the story in Regfollower |
UK: | Financial services-Restriction on interest deduction: The new corporate interest restriction (CIR), which were adopted in the Finance (No.2) Act 2017 and received on Royal Assent on 16 November 2017, provide for an additional potential restriction of UK tax relief on borrowing costs, after the existing tax rules (including the transfer pricing rules) have been applied. See the story in Regfollower |
Qatar: | Multilateral: Qatar has joined the Base Erosion and Profit Shifting (BEPS) Inclusive Framework. The Convention can be used to swiftly implement exchange of country-by-country reports under BEPS action 13 and exchange of tax rulings under BEPS action 5. See the story in Regfollower |
France: | Documentation-Requirement: On 21 November 2017, in its first round of discussions, the National Assembly added the national transfer pricing requirements to the draft Finance Act 2018. According to the bill, the transfer pricing documentation will be aligned with the OECD standards. This measure applies to financial years beginning on or after 1 January 2018. See the story in Regfollower |
Russia: | Documentation-Requirement: On 16 November 2017, the House of Commons (State Duma) finalized the draft law implementing the international automatic exchange of financial accounting information and transfer pricing documentation (TP) of multinationals. The draft bill is still subject to the approval of the Federal Council and signature of the President. See the story in Regfollower |
Ireland: | CbC reporting requirement-Timing: Regarding the late availability of the CbC reporting facility, CbC Reports on fiscal years ending in 2016 will open and accept until 28 February 2018. The reason for the two month extension is that Ireland’s revenue department has developed an electronic CbC reporting system that includes a standard validation module provided by the European Commission. See the story in Regfollower |
Australia: | Special rules for hybrid instruments or entities: On 24 November 2017, Australia’s Treasurer released Exposure Draft legislation (ED) for public consultation addressing hybrid mismatch arrangements in order to strengthening the integrity of Australia’s tax system, and stamping out multinational tax avoidance. See the story in Regfollower |
Colombia: | CbC reporting requirement-General rule: The National Tax Administration of Colombia (DIAN) has recently announced that taxpayers subject to a transfer pricing regime have to comply with the new conditions for accepting transfer pricing documentation in line with the new international standards set out in Action 13 of the BEPS OECD / G20 project. See the story in Regfollower |
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Hungary: Parliament approves new tax measures
World Tax Brief: November 2017
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