Worldwide transfer pricing reference guide 2014

Finland (continued)
Documentation requirements (continued)
Group companies are required to prove the arm’s length nature of cross-border intra-group transactions by preparing transfer pricing
documentation. According to the law, the documentation should contain the following information:
• A description of the business
• A description of associated enterprises
• Information on transactions between associated enterprises
• Functional analysis regarding transactions between associated enterprises
• A comparability analysis, including available information on comparables
• A description of the transfer pricing method and its application
Less extensive documentation is required during a fiscal year if the total amount of transactions between two parties does not exceed
EUR500, 000.
Documentation deadlines
A taxpayer has to submit the transfer pricing documentation for a specific fiscal year within 60 days of a request by the tax authorities,
but not earlier than six months after the end of the financial period. The additional clarifications concerning the documentation have to
be submitted within 90 days of a request by the tax authorities.
Statute of limitations on transfer pricing assessments
The time limit for the adjustment of income due to the failure in applying arm’s length principles to the pricing of a transaction is five
years from the beginning of the following year in which the taxation was finalized.
Return disclosures/related party disclosures
Based on Paragraph 26.4 of the Finnish Tax Act on Assessment Procedure, if the other party to the transaction is a non-resident, and if
the tax authorities cannot obtain adequate information on the transaction by using an appropriate international treaty, the taxpayer is
responsible for presenting such information.
Frequency of tax audit and transfer pricing scrutiny by the tax authority
In general, the likelihood of annual tax audit is characterized as low. The likelihood of transfer pricing being reviewed as part of an audit,
and the likelihood of a challenge to the transfer pricing methodology is high.
APA opportunity
Advance rulings are available in Finland. There is no legislation for APAs; however, the tax authorities have indicated their willingness to
utilize them.
Expected reaction to OECD Report on BEPS
As of January 2014, there are no proposed legislative changes to the tax law or to the documentation requirements regarding transfer
pricing. However, the Finnish tax administration is actively taking part in the discussion concerning BEPS. Being a member country of
OECD, changes to the transfer pricing guidelines will subsequently affect Finland.
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