Transfer Pricing Library

TP Library

OECD: Fighting Tax Crime – The Ten Global Principles, Second Edition

OECD: Fighting Tax Crime – The Ten Global Principles, Second Edition
“Fighting Tax Crime – The Ten Global Principles” is a comprehensive guide to fighting tax crimes published by the OECD. Read the online report here. The report sets out ten essential principles covering the legal, institutional, administrative, and operational aspects necessary for developing an efficient and effective system for identifying, investigating and prosecuting tax crimes, while respecting the rights of accused taxpayers. The guidance also addresses new challenges, such as tackling professionals who enable tax and white-collar crimes, and fostering international co-operation in the recovery of assets. Drawing on the experiences of jurisdictions in all continents, the report also highlights

Paraguay’s TP Decree in effect as of April 2021

Paraguay's TP Decree in effect as of April 2021
Paraguay’s new Transfer Pricing Decree in effect as of April 2021. Click here for English Translation Decreto N° 4644-2020

UN releases New 2021 Practical Manual on Transfer Pricing

UN releases New 2021 Practical Manual on Transfer Pricing
On 27 April UN released a new 2021 Practical Manual on Transfer Pricing. “…this third edition of the Manual makes improvements in usability and practical relevance, updates and improves the existing text, including on Country Practices (Part D) and has new content, in particular, on financial transactions, profit splits, centralized procurement functions and comparability issues. Improved capacity development based on the Manual has encouraged and contextualized developing country feedback, helped identify these priority areas for improvement and contributed to better targeting the messages in the Manual and examples used.” The changes in the new edition of the Manual include: •

UN agrees on inclusion of Article 12B to the UN Model Tax Treaty – computer software

UN agrees on inclusion of Article 12B to the UN Model Tax Treaty - computer software
On 26. April 2021 the UN released agreed changes to the commentary on Article 12 of the United Nations Model Double Taxation Convention reflecting decisions made with respect to the inclusion of Article 12B and the treatment of computer software. UN model Proposed Art 12 Commentary

EU: Public Country-by-Country Reporting?

EU: Public Country-by-Country Reporting?
Proposal directive of public country-by-country reporting in the EU Ministers held an exchange of views (public session) on how to take the proposed directive forward. Tax transparency is a fundamental principle in any democratic society. It enables policy makers to take informed decisions and to ensure that all economic actors contribute in a fair and equitable manner to the economy of the various countries where they conduct their business. Today’s debate has opened the way for the proposed directive to move forward as a matter of priority. Pedro Siza Vieira, Portuguese Minister of State for the Economy and Digital Transition

Spain releases note on arm’s length range and benchmarking.

Spain releases note on arm's length range and benchmarking.
On 25 February 2021, a note was released by the Spanish Tax Agency on number of practical issues relating to application of the arm’s-length range. The note – which is based on the OECD transfer Pricing Guidelines, guidance on benchmark studies issued by the Joint Transfer Pricing Forum, and relevant Spanish case laws – answers the following questions – How is the range of values determined? – Is it possible to determine a range of values in which the figures are relatively equally reliable? – How to proceed if a range is determined in which all figures are not relatively

OECD Guidance on the transfer pricing implications of the COVID-19 pandemic

OECD Guidance on the transfer pricing implications of the COVID-19 pandemic
Unique economic conditions arising from COVID-19 and government responses to the pandemic have led to practical challenges for the application of the arm’s length principle. For taxpayers applying transfer pricing rules for the financial years impacted by the COVID-19 pandemic and for tax administrations that will be evaluating this application, there is an urgent need to address these practical questions. The OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations 2017 (“OECD TPG”) are intended to help tax administrations and multinational enterprises (“MNEs”) find mutually satisfactory solutions to transfer pricing cases and should continue to be relied upon when

Peru – report on use of the most appropriate method to determine the market value of services

Peru - report on use of the most appropriate method to determine the market value of services
In december 2020 the tax authorities in Peru issued a new administrative ordinance related to use of the most appropriate method to determine the market value of services. Click here for English translation Click here for other translation PERU i135-2020-7T0000

New German Administrative Ordinance on transfer pricing issues AO 2020, DOK 2020/1174240

New German Administrative Ordinance on transfer pricing issues AO 2020, DOK 2020/1174240
In december 2020 the Federal Ministry of Finance in German issued a new administrative ordinance related to various transfer pricing issues. Among the issues are enhanced requirement to cooperate and submit additional documentation related to controlled transactions, but most notable may be the conditions under which estimated tax assessments can be issued. Below is an unofficial translation of the document. Click here for the original document  2020-12-03-Verwaltungsgrundsaetze-2020 (Unofficial Eng trans)nw

New TPG Chapter X on Financial Transactions (and additions to TPG Chapter I) released by OECD

New TPG Chapter X on Financial Transactions (and additions to TPG Chapter I) released by OECD
In February 2020, OECD released the report Transfer Pricing Guidance on Financial Transactions. The guidance in the report describes the transfer pricing aspects of financial transactions and includes a number of examples to illustrate the principles discussed in the report. Section B provides guidance on the application of the principles contained in Section D.1 of Chapter I of the OECD Transfer Pricing Guidelines to financial transactions. In particular, Section B.1 of this report elaborates on how the accurate delineation analysis under Chapter I applies to the capital structure of an MNE within an MNE group. It also clarifies that the

2019 Update-UN-Practical-Manual-on-Transfer-Pricing

2019 Update-UN-Practical-Manual-on-Transfer-Pricing
On 8 April 2019 the UN subcommittee issued it’s first discussion draft on the future updates to the UN Practical-Manual-on-Transfer-Pricing on Financial transactions, BEPS consistency and Risk Assessment and Audit practices. Attachment A: the proposed new Chapter B on Financial Transactions. The draft discusses the importance of corporate financing decisions within multinational groups and how those decisions could lead to tax base The Chapter discusses interaction with rules and measures against base erosion; common types of intra- group financial transactions and of group financing departments; the process of actual delineation and relevant characteristics of financial transactions; the process and system

May 2019: New Beneficial Ownership Toolkit will help tackle tax evasion

May 2019: New Beneficial Ownership Toolkit will help tackle tax evasion
A beneficial ownership toolkit was released 20. May 2019 in the context of the OECD’s Global Integrity and Anti-Corruption Forum. The toolkit, prepared by the Secretariat of the OECD’s Global Forum on Transparency and Exchange of Information for Tax Purposes in partnership with the Inter-American Development Bank, is intended to help governments implement the Global Forum’s standards on ensuring that law enforcement officials have access to reliable information on who the ultimate beneficial owners are behind a company or other legal entity so that criminals can no longer hide their illicit activities behind opaque legal structures. The toolkit was developed

March 2019: EU list of Non-Cooperative Tax Jurisdictions – Tax Havens

March 2019: EU list of Non-Cooperative Tax Jurisdictions - Tax Havens
12 March 2019 the EU Council added ten jurisdictions to the list of Non-Cooperative Tax Jurisdictions – Tax Havens. Non-Cooperative Tax Jurisdictions are those that refused to engage with the EU or to address tax good governance shortcomings. As of March 2019 the EU list of Non-Cooperative Tax Jurisdictions includes 15 countries: American Samoa Barbados Guam Samoa Trinidad and Tobago US Virgin Islands Aruba Belize Bermuda Dominica Fiji Marshall Islands Oman United Arab Emirates Vanuatu EU black list 2019

Profit Diversion Compliance Facility (PDCF) Published by HMRC January 2019

Profit Diversion Compliance Facility (PDCF) Published by HMRC January 2019
HMRC Profit Diversion Compliance Facility Chapter 1 – introduction 1.1 Background Companies should recognise and pay tax on profits where the economic activities to generate those profits are carried out. HMRC has found that some Multinational Enterprises (MNEs) have adopted cross border pricing arrangements which are based on an incorrect fact pattern and/or are not consistent with the Organisation for Economic Co-operation and Development (OECD) Transfer Pricing Guidelines (TPG), as clarified through Actions Points 8-10 of the OECD Base Erosion and Profit Shifting Project. This is for 2 main reasons: Firstly, some have made incorrect assumptions, or not implemented arrangements as originally intended

Israel – Guidance on Limited Risk Distribution – Circular 12/2018

Israel - Guidance on Limited Risk Distribution - Circular 12/2018
Circular on transfer pricing – profitability rates and ranges for certain transactions – Limited Risk Distributors (LRDs) tnf-israel-12-oct9-2018

Israel – Guidance on Limited Risk Distribution – Circular 11/2018

Israel - Guidance on Limited Risk Distribution - Circular 11/2018
Circular on transfer pricing – profitability rates and ranges for certain transactions – Limited Risk Distributors (LRDs) tnf-israel-11-oct9-2018

Guidance on the application of the HTVI approach

Guidance on the application of the HTVI approach
This June 2018 report contains guidance for tax administrations on the application of the approach to hard-to-value intangibles (HTVI). The HTVI approach was adopted as part of the Actions 8-10 Report in 2015 and it was subsequently incorporated in Chapter VI of the OECD Transfer Pricing Guidelines. The guidance  is aimed at reaching a common understanding and practice among tax administrations on how to apply adjustments resulting from the application of the approach to HTVI. The guidance includes a number of examples to clarify the application of the HTVI approach in different scenarios and addresses the interaction between the HTVI approach and

OECD Article 9 (with commentary)

ARTICLE 9 ASSOCIATED ENTERPRISES 1. Where an enterprise of a Contracting State participates directly or indirectly in the management, control or capital of an enterprise of the other Contracting State, or the same persons participate directly or indirectly in the management, control or capital of an enterprise of a Contracting State and an enterprise of the other Contracting State, and in either case conditions are made or imposed bet ween the two enterprises in their commercial or financial relations which differ from those which would be made between independent enterprises, then any profits which would, but for those conditions, have

September 2017: Handbook on Effective Tax Risk Assessment using CbC Reports

September 2017: Handbook on Effective Tax Risk Assessment using CbC Reports
The Handbook on Effective Tax Risk Assessment explores how information contained in CbC reports can be used for risk assessment and which types of tax risk indicators that may be identified using the information contained in CbC Reports. In chapter 4 some of the main tax risk indicators that may be identified using CbC Reports are described: The footprint of a group in a particular jurisdiction A group’s activities in a jurisdiction are limited to those that pose less risk There is a high value or high proportion of related party revenues in a particular jurisdiction The results in a

December 2016: EU Study on Comparable Data used for transfer pricing

December 2016: EU Study on Comparable Data used for transfer pricing
The Study on Comparable data used for Transfer Pricing in the EU provides an overview and assessment of the availability and quality of market data ('comparables') used for transfer pricing purposes in the EU. Furthermore it assesses and evaluates situations characterising the lack and/or non-reliability of comparable data as well as the situation for pan-European comparable searches.

Statement released by New Zealand’s Inland Revenue on determining whether an Arrangement is Tax Avoidance

Statement released by New Zealand's Inland Revenue on determining whether an Arrangement is Tax Avoidance
On 13 June 2013, a Statement was released by New Zealand’s Inland Revenue Service on the interpretation of Tax Avoidance provisions. This statement outlines the Commissioner’s view of the law on tax avoidance in New Zealand and sets out the approach the Commissioner will take to application of the general anti-avoidance provision, based on the three-stage test for assessing whether an arrangement is tax avoidance as provided by the Supreme Court Judgment in the Ben Nevis case. In Ben Nevis case the Supreme Court indicated it intended to settle the approach regarding the relationship between s BG 1 and the

April 2013: Draft Handbook on Transfer Pricing Risk Assessment

April 2013: Draft Handbook on Transfer Pricing Risk Assessment
The 2013 Draft Handbook on Transfer Pricing Risk Assessment is a detailed, practical resource that countries can follow in developing their own risk assessment approaches. The handbook supplements useful materials already available with respect to transfer pricing risk assessment. The OECD Forum on Tax Administration published a report entitled “Dealing Effectively with the Challenges of Transfer Pricing” in January 2012. One chapter of that report also addresses transfer pricing risk assessment. Draft-Handbook-TP-Risk-Assessment-ENG