Category: Advance Pricing Agreement

MAP-ping tax reform: Good start to resolving transfer pricing row with US

Though the use of the retrospective tax on Vodafone and Cairn tend to grab the headlines, a large part of the ‘tax terror’ in India has really been the contribution of the high-pitched transfer pricing (TP) additions to the income of the MNCs Though the use of the retrospective tax… – Continue reading

100 transfer pricing disputes with US resolved, says CBDT

NEW DELHI: The Central Board of Direct Taxes (CBDT) today said it has resolved as many as 100 transfer pricing disputes with the US, which will lead to an environment of “tax certainty and encourage MNCs” to do business in India. The resolution of such issues, CBDT said further, follows… – Continue reading

TAX DEPT INKS SEVEN NEW TRANSFER PRICING PACTS

The new advanced pricing agreements cover sectors like investment advisory, IT enabled services and manufacturing In the current fiscal year, which is the third year of APA programme, 30 agreements have been signed so far. As part of efforts to reduce tax disputes related to international transactions carried out by… – Continue reading

APA and MAP program management unit

As part of the ATO’s reinvention agenda we have been reviewing our Advance pricing arrangement (APA), Mutual agreement procedure (MAP) programs and our Competent Authority Network to identify opportunities to: improve the client experience and better support willing participation improve our bilateral and multilateral engagement increase our efficiency and effectiveness…. – Continue reading

Jamaica Explains New Transfer Pricing Rules

Jamaica has released information explaining its new transfer pricing regime, with transfer pricing documentation due on March 15, 2016. According to the Government, 2015 amendments to the Income Tax Act were intended to remove any subjectivity in the administration of transfer pricing rules. The Government said: “Taxpayers have always had… – Continue reading

Why the mad rush to implement a transfer pricing regime?

Dr Peter Phillips, the finance minister, is about to undo all the good he has done with the economy by implementing the proposed transfer pricing regime. The Government assures the country that this unconstitutional transfer pricing mechanism isn’t a tax, but an attempt to get affected businesses to pay their… – Continue reading

2015: Transfer Pricing Round-Up

The year 2015 was arguably a momentous one for transfer pricing (TP). A combination of local and international developments will mark it as a period which defined the future direction of this subject. Key Developments The Organization for Economic Cooperation & Development (OECD) released final reports as part of its… – Continue reading

Year 2015: Govt showed intent to bring certainty in tax laws

The National Democratic Alliance (NDA) government came to power with the promise of putting an end to what many called the tax ‘extortion’ regime of the previous government. The year 2015 was the first full year for the government to walk some of its talk on tax reform. Though the… – Continue reading

Australia: Country-by-country reporting guidelines

The Australian Taxation Office (ATO) on 17 December 2015 released guidelines that address country-by-country reporting. The ATO release—Law Companion Guideline (LCG) 2015/3—discusses Tax Laws Amendment (Combating Multinational Tax Avoidance) Act 2015 that was enacted earlier this month and discusses, in particular, Schedule 4. Background Schedule 4 created Subdivision 815-E of… – Continue reading

Tax Update: Tax Ruling Transparency in the EU – What You Need to Know

In the wake of the final OECD BEPS reports issued in October, the European Council adopted amendments to Directive 2011/16/EU providing for the automatic exchange of information concerning advance cross border rulings (ACBR) and advance pricing arrangements (APA) between Member States. The amendments, which will come into force from 1… – Continue reading

An Overview of Transfer Pricing in Vietnam

Transfer pricing is a tax planning method where related companies enter into transactions among each other to shift funds, and thereby profits. For instance, a parent company can extract funds from a subsidiary by having the issue a dividend, but the parent can also provide a service to subsidiary and… – Continue reading

Signing of Advance Pricing Agreements (APAs) signals major push towards tax certainty

The Central Board of Direct Taxes (CBDT) has recently entered into eleven (11) more Advance Pricing Agreements (APAs) with Indian subsidiaries for foreign companies. In a major push towards providing certainty to foreign investors in the arena of transfer pricing, the CBDT signed these APAs operating in various segments of… – Continue reading

Cross-border tax rulings – Transparency rules adopted

On 8 December 2015, the Council adopted a directive aimed at improving transparency on tax rulings given by member states to companies in specific cases about how taxation will be dealt with. The directive is one of a number of initiatives aimed at preventing corporate tax avoidance. It will require… – Continue reading

EU adopts new transparency rules

The EU Council has adopted a new transparency directive aimed at preventing corporate tax avoidance The directive, which was proposed by the European Commission (EC), is aimed at improving transparency on tax rulings given by member states to companies about how their taxes are calculated. Under the new directive, member… – Continue reading

Private sector opposes retroactive tax measure

THE Private Sector Organisation of Jamaica (PSOJ) is not happy with amendments to the Income Tax Act that will see the implementation of a transfer pricing regime retroactive to April 1 this year. The PSOJ, in a letter to Tax Administration Jamaica (TAJ) Commissioner General Ainsley Powell in September, had… – Continue reading

China’s new transfer pricing guidelines and BEPS

The highly significant changes to transfer pricing guidance planned for under the SAT’s public discussion draft on ‘Special Tax Adjustments’ (yet to be finalised at the time of writing), and the impact of these changes in the light of evolving Chinese transfer pricing enforcement practice is the focus of this… – Continue reading

Thailand’s New Transfer Pricing Guidelines

Thailand’s vote this past May to implement a new transfer pricing law is expected to come into effect in the early part of the new year. Transfer pricing refers to the sale of goods or services between branches of a company or subsidiary companies to a parent enterprise, and most… – Continue reading

China: Discussion Draft Of Implementation Regulations For Special Tax Adjustment Issued — Interpretation Of Transfer Pricing Investigation And Adjustment

On 17 September, 2015, China State Administration of Taxation (“SAT”) released the Discussion Draft of Implementation Measures for Special Taxation Adjustments (“Discussion Draft”), as a complete revamp to the existing trial version of the Implementation Measures, i.e., Circular 2. Circular 2 has been serving as a backbone transfer pricing (“TP”)… – Continue reading

European Union: European Council Approves Transparency Rules For Tax Rulings

Following a directive proposal put forward by the European Commission as part of a package of measures in March, the European Council reached political agreement on a directive amending the text of 2011/16/EU directive on administrative cooperation in the field of taxation. EU member states will be required to automatically… – Continue reading

Transfer Pricing Documentation in a Post-BEPS World

“It is not the strongest or the most intelligent who will survive but those who can best manage change”-Charles Darwin The Organization for Economic Co-operation and Development (OECD) released its final recommendations on the Base Erosion and Profit Shifting (BEPS) Project on October 5, 2015. The BEPS project consist of… – Continue reading

CBDT signs 11 more unilateral advance pricing agreements

NEW DELHI, NOVEMBER 27: The Central Board of Direct Taxes (CBDT) has entered into 11 more unilateral advance pricing agreements (APAs). These APAs were signed with Indian subsidiaries of foreign companies operating in various segments of the economy like investment advisory services, engineering design services, marine products, contract Research & Development,… – Continue reading

I-T Dept inks 11 agreements to solve transfer-pricing issues

Of these, one advance pricing agreement has a ‘rollback provision’ The government has concluded 11 agreements to tax multi-national companies via the transfer-pricing mode. Of these, one advance pricing agreement (APA) has a ‘rollback provision’, which means those relating to previous years. The government has signed 22 APAs so far… – Continue reading

ATO takes tighter approach to deals with multinationals on future taxes

Tax Commissioner Chris Jordan has become more picky about entering agreements with multinationals aimed at giving companies certainty about their tax payment requirements in Australia in future years. Taxpayers can lock in their tax payment for a period of about three years via an “advanced pricing agreement”, or APA. Technology… – Continue reading

KPMG leader visit highlights BEPS initiative

Latest developments under the Base Erosion and Profit Shifting (BEPS) initiative of the Organisation for Economic Co-operation and Development (OECD) was one of the key points of a recent four-day visit by KPMG’s global leader for Transfer Pricing Services Sean Foley to Vietnam. He shared the issue with Vietnam’s General… – Continue reading

Mutual Agreement Procedure (MAP) for navigating the tax tangle

If statistics are anything to go by, today India is the world’s fastest growing economy at 7.3% in 2015, outstripping the global average of 3.1%. With a new government in the centre, we do seem to be riding high on the growth trajectory. The Modi government has certainly done its… – Continue reading

PwC calls for tweaks to S’pore tax system

Policies on perks, more bilateral pacts can help generate funds for growth: Accounting firm Singapore’s tax system can be improved to ensure the country can generate the funds needed for long-term growth and development, according to a white paper from accounting giant PwC yesterday. It called for policies that ensure… – Continue reading

Retro tax still a concern for foreign investors: John Hobster

Foreign investors are still concerned about the retrospective taxation in India, but the concerns have alleviated a little due to assurances by the government, says John Hobster, global head (transfer pricing), EY. He tells Dilasha Seth that in terms of transfer pricing, things are changing in India not only at… – Continue reading

U.S. Implementation of BEPS Changes Begins

As at least the first phase of the OECD’s BEPS project1 wound down with the October release of the “final” BEPS deliverables, questions remained regarding how much of the recommended changes would be implemented in the United States in the near term. Because many of the recommendations require legislative changes… – Continue reading

Australia: The transfer pricing Chevron decision – funding, parental support, currency… and the experts

Key Points: The rejection of the Commissioner’s position on the relevance of credit rating agencies and the relevance of implicit support will give rise to uncertainty going forward, as it is unclear how an arm’s length interest rate can be practically determined. The Federal Court’s recent decision in Chevron Australia… – Continue reading

FRANCE: RECENT TRENDS IN TRANSFER PRICING, SURVEY

The European Commission recently published new rulings, the OECD published its base erosion and profit shifting (BEPS) final reports, and many countries are reviewing and reinforcing their transfer pricing rules—and France is no exception. Tax professionals in France have observed certain recent trends with regards to transfer pricing. The current… – Continue reading

Strategic resets under new MAP and APA revenue procedures

Introduction The Internal Revenue Service (IRS) recently replaced Revenue Procedure 2006-54 for requesting assistance under the mutual agreement procedure (MAP) article of US tax treaties, and Revenue Procedure 2006-9 for requesting advance pricing agreements (APAs). New Revenue Procedures 2015-40 and 2015-41 largely track draft procedures issued in 2013 (Notices 2013-78… – Continue reading

European Commission adopts first two decisions in EU tax probe in push for corporate tax reform

On 21 October, the European Commission (“EC”) adopted its first decisions in its investigation into Member States’ tax rulings. The investigation, which began in June 2013, has also targeted tax rulings given to Apple and Amazon as well as Belgium’s so-called “excess profits regime”. Although the investigation is conducted under… – Continue reading

Shaw Knocks Transfer Pricing Bill As Disincentive To Foreign Investors

its tax bulletins, the legislation will apply to transactions even between unconnected parties if the non-Jamaican party is in a tax haven. In addition, it will take into account the use of captive insurance companies, that is, insurance companies established by a parent group or groups with the specific objective… – Continue reading

China: Discussion Draft For The Implementation Measures For Special Tax Adjustments —A Brand-New Epoch For Transfer Pricing Administration In China

On 17 September, 2015, China State Administration of Taxation (SAT) released the Discussion Draft for the Implementation Measures for Special Tax Adjustments (“Discussion Draft”), as a complete revamp to the existing trial version of the Implementation Measures, i.e., Circular 2. Circular 2 has been serving as a backbone transfer pricing… – Continue reading

CBDT inks 4 more advance pricing pacts

MUMBAI: The Central Board of Direct Taxes (CBDT) on October 13 signed four unilateral advance pricing agreements (APAs), including India’s second APA with a rollback provision. The nature of the transactions covered under these agreements varied from software development to share price valuation. According to government sources, the total number… – Continue reading

Putting the Final BEPS Reports into Perspective: from Recommendations to Implementation

The Organization of Economic Cooperation and Development (OECD) released its final reports on the G20/OECD Base Erosion and Profit Shifting (BEPS) Project on Monday October 5th, 2015. The final package of BEPS measures includes new minimum standards on: country-by-country reporting, which for the first time will give tax administrations a… – Continue reading

Canada: International Tax Reform 2015-BEPS Final Reports

On October 5, 2015, the OECD released its final reports relating to the OECD/G20 base erosion and profit shifting (BEPS) project (the Final Reports). The BEPS project began in 2013 and has received unprecedented attention from governments and the private sector. The Final Reports outline the OECD’s recommendations and the… – Continue reading

ECOFIN Council reaches agreement on the automatic exchange of information on tax rulings and APAs

On 6 October 2015, the Council of the European Union reached agreement on a proposal for a Council Directive (‘the New Directive’) amending Directive 2011/16/EU (Directive on administrative cooperation between Member States) and requiring automatic exchange of information on ‘advance tax rulings’ (‘Tax Rulings’) and ‘advance pricing arrangements’ (‘APAs’) between… – Continue reading

EU: AUTOMATIC EXCHANGE OF INFORMATION, CROSS-BORDER TAX RULINGS AND APAS

EU finance ministers today agreed to introduce provisions for the automatic exchange of information on cross-border tax rulings—the latest development concerning the European Commission’s initiative to address tax avoidance and harmful tax competition. Detailed provisions to be included in a directive are expected to be finalized before the end of… – Continue reading

India signs 16 advance pricing agreements with MNCs

The income tax department has signed 16 advance pricing agreements (APAs) with multinational companies (MNCs) so far, exempting their transactions with local units from rigorous tax audits. The income tax department has signed 16 advance pricing agreements (APAs) with multinational companies (MNCs) so far, exempting their transactions with local units… – Continue reading

Denmark Legislates For CbC Reporting

On September 18, 2015, the Danish Ministry of Taxation published draft legislation to introduce a new country-by-country reporting obligation for multinational corporations. The draft Bill would introduce the new three-tiered approach to transfer pricing documentation that is to be proposed formally by the OECD as part of the BEPS deliverables… – Continue reading

Canada: CBSA Issues Revised Customs Guidance On Related Party Transactions And Value For Duty: New Opportunities And Obligations

On September 17, 2015, the Canadian Border Services Agency (“CBSA“) released a revised D-Memorandum D13-4-5, “Transaction Value Method for Related Persons” (the “Memorandum“), addressing the impact of income tax transfer pricing on the value for duty to be declared on goods imported into Canada. This new guidance will have a… – Continue reading

Unexpected tax troubles cropping up in emerging countries

Honda’s manufacturing plant in India, one of the emerging countries where many Japanese companies are in disputes with local tax authorities. TOKYO — Many Japanese companies operating in emerging countries are grappling with taxation problems they would never face in major industrial nations. Honda Motor, for instance, has gotten embroiled… – Continue reading