The associated enterprises may also benefit from simultaneous tax examinations from the savings of time and resources due to the coordination of inquiries from the tax administrations involved and the avoidance of duplication. In addition, the simultaneous involvement of two or more tax administrations in the examination of transfer pricing between associated enterprises may provide the opportunity for an MNE to take a more active role in resolving its transfer pricing issues. By presenting the relevant facts and arguments to each of the participating tax administrations during the simultaneous tax examination the associated enterprises may help avoid misunderstandings and facilitate the tax administrations’ concurring determination and evaluation of their transfer pricing conditions. Thus, the associated enterprises may obtain certainty with regard to their transfer pricing at an early stage. See paragraph 4.79.
TPG2022 Chapter IV paragraph 4.92
Category: D. Simultaneous tax examinations | Tag: Simultaneous tax examinition/audit
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- TPG2022 Chapter IV paragraph 4.93As a result of the increased use of simultaneous tax examinations among OECD member countries, the Committee on Fiscal Affairs decided it would be useful to draft the OECD Model Agreement for those countries that are able and wish to engage in this...
- TPG2022 Chapter IV paragraph 4.90In some cases the simultaneous tax examination procedure may allow the participating tax administrations to reach an agreement on the transfer pricing conditions of a controlled transaction between the associated enterprises. Where an agreement is reached, corresponding adjustments may be made at an...
- TPG2022 Chapter IV paragraph 4.80Simultaneous tax examinations are defined in Part A of the OECD Model Agreement for the Undertaking of Simultaneous Tax Examinations (OECD Model Agreement). According to this agreement, a simultaneous tax examination means an “arrangement between two or more parties to examine simultaneously and...
- TPG2022 Chapter IV paragraph 4.91Even if no agreement between the tax administrations can be reached in the course of a simultaneous tax examination with respect to the associated enterprises’ transfer pricing, the OECD Model Agreement envisions that either associated enterprise may be able to present a request...
- TPG2022 Chapter IV paragraph 4.89The process also might allow for the identification of potential transfer pricing disputes at an early stage, thereby minimising litigation with taxpayers. This could happen when, based upon the information obtained in the course of a simultaneous tax examination, the participating tax examiners...
- TPG2022 Chapter IV paragraph 4.86Once a case is selected for a simultaneous examination it is customary for tax inspectors or examiners to meet, to plan, to coordinate and to follow closely the progress of the simultaneous tax examination. Especially in complex cases, meetings of the tax inspectors...
- TPG2022 Chapter IV paragraph 4.88One objective of simultaneous tax examinations is to promote compliance with transfer pricing regulations. Obtaining the necessary information and determining the facts and circumstances about such matters as the transfer pricing conditions of controlled transactions between associated enterprises in two or more tax...
- TPG2022 Chapter IV paragraph 4.87Simultaneous tax examinations may be a useful instrument to determine the correct tax liability of associated enterprises in cases where, for example, costs are shared or charged and profits are allocated between taxpayers in different taxing jurisdictions or more generally where transfer pricing...
- July 2018: Transfer Pricing Practices in the Oil Sector, and their Potential Application to MiningIn July 2018 Center for Global Development published a study of special transfer pricing practices in the oil sector, and their potential application to hard rock minerals. According to the study, governments of mining countries are vulnerable to investors manipulating transfer prices as...
- September 2017: Transfer Pricing Risk Assessment in the Mining IndustryThe African Tax Administration Forum (ATAF) and the German Federal Ministry for Economic Cooperation and Development (BMZ), through the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH, have developed this toolkit for African tax authorities seeking to assess transfer pricing risk in the mining...