Transfer Pricing (TP) guidelines generally require associated entities to invoice each other appropriately so as to correspond to the value of the goods transferred or services provided whenever an intra-group transaction takes place. The basis for determining proper compensation is, in most cases, the arm’s length principle. In a nutshell, the arm’s-length principle requires that … Read more
Introduction This Chapter provides a background discussion of the arm’s length principle, which is the international transfer pricing standard that OECD member countries have agreed should be used for tax purposes by MNE groups and tax administrations. The Chapter discusses the arm’s length principle, reaffirms its status as the international standard, and sets forth guidelines … Read more
The selection of a transfer pricing method always aims at finding the most appropriate method for a particular case. For this purpose, the selection process should take account of the respective strengths and weaknesses of the OECD recognised methods. “Traditional transaction methods” and “transactional profit methods” can be used to establish whether the conditions imposed … Read more
REPUBLIC OF CYPRUS MINISTRY OF FINANCE Ref. No.: 05.13.001 Interpretative Circular 3 — Income Tax June 30th, 2017 To all Assessing Staff Tax treatment of intra-group back-to-back financial arrangements 1. Definitions 1. This Circular applies to any company carrying out group financing transactions (hereinafter referred to as a group financing company) meaning any entity that … Read more
Although Russia is a Non-OECD economy there are certain provisions for the implementation of transfer pricing policies in related party transactions. The regulatory framework is not keen on preventing tax avoidance through transfer pricing schemes. However, accountants, auditors and tax professionals are aware for the principles, while Russian tax administration is alerted indeed. Reference to … Read more