Worldwide transfer pricing reference guide 2014

Russian Federation (continued)
OECD guidelines treatment
Russia is not a member of the OECD; however, the new transfer pricing law is largely based on the principles stipulated by the OECD
Guidelines.
Priorities/pricing methods
The transfer pricing law includes five methods similar to those used in the international transfer pricing practice. The Resale Minus
method has first priority for a routine distributor. In all other cases CUP method prevails, whereas the Profit Split is a method of
last resort.
Transfer pricing penalties
In 2012 and 2013, penalty provisions were not applicable. In 2014, transfer pricing penalties of 20% of the additional tax payable will be
introduced. In 2017, the penalties will be increased to 40%.
Penalty relief
Penalties will be imposed if a taxpayer’s income is adjusted as a result of a transfer pricing audit, and if the taxpayer did not provide the
requested transfer pricing documentation. Penalties cannot apply if prices were established in accordance with an applicable APA.
Documentation requirements
The law envisages that taxpayers must prepare and maintain a certain set of documents, in any suitable form, justifying the pricing
method used in controlled transactions where the annual revenue of all controlled transactions between the same related parties
exceeds RUB100 million (approximately US$2.9 million).
Documentation is not required for cross-border third party transactions, transactions where prices conform to a regulated price or a
price that is prescribed by the anti-monopoly authorities, transactions with securities and derivatives traded on an organized equity
market and for transactions covered by an APA.
Documentation deadlines
Transfer pricing documentation must be presented within 30 days of the tax authorities’ request. The request can be issued no earlier
than 1 June of the year following the year in which the controlled transaction took place.
Statute of limitations on transfer pricing assessments
The general rule is that the tax authority may audit the taxpayer for up to three years preceding the year when the audit is conducted.
• Transfer pricing audits of transactions performed in 2012 can be initiated no later than 30 June 2014
• Transfer pricing audits of transactions performed in 2013 can be initiated no later than 31 December 2015
Return disclosures/related party disclosures
Disclosure of transactions with related parties and also other types of third-party transactions, which would remain subject to transfer
pricing control (e.g., transactions with parties located in low-tax jurisdictions and cross-border sale of oil and oil products, minerals),
is required by way of in a transfer pricing specific return. Such return for 2013 is due by 20 May 2014, and for 2014 — by 20 May 2015.
Transfer pricing–specific returns
As above for return disclosures/related party disclosures.
Worldwide transfer pricing reference guide
254