Worldwide transfer pricing reference guide 2014

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South Africa (continued) APA opportunity South Africa does not currently have an APA program, although one is being considered. The legislation also currently prohibits SARS from providing an advance ruling to establish a price. Expected reaction to OECD Report on BEPS Following the 2013 Budget announcement, the Minister of Finance of South Africa publicized the members of a tax review committee on 17 July 2013. The committee, now known as the Davis Tax Committee (DTC), will examine the role of South Africa’s tax system to promote growth, job creation, sustainable development and fiscal self-reliance. It will take into account the long term objectives of the National Development Plan in its work. The DTC has adopted a work program that has prioritized the establishment of specialist sub-committees on small businesses, the appropriateness of the tax base and tax mix in South Africa, and BEPS. As of January 2014, neither specific results on the BEPS action items with regard to intangibles, value contribution and risk allocation have been published by this group nor has South Africa introduced specific legislation or published a decree. Worldwide transfer pricing reference guide 274
South Korea (Republic of Korea) Taxing authority and tax law Taxing authority: National Tax Service (NTS). Tax law: The Law for Coordination of International Tax Affairs (LCITA). Relevant regulations and rulings • Presidential Enforcement Decree (PED) • Ministerial Decree and Interpretations OECD Guidelines treatment The LCITA takes priority over the OECD Guidelines. The NTS recognizes the OECD Guidelines, but they have no legally binding effect. Hence, if a taxpayer’s argument is based only on the OECD Guidelines and not on the LCITA, in practice, the NTS or regional tax offices may not accept it. Priorities/pricing methods The Korean transfer pricing regulations prescribe the following transfer pricing methods: CUP, RPM, Cost Plus (CP), Profit Split (PSM), TNMM, and other reasonable methods. Of the aforementioned transfer pricing methods, the taxpayer is to select the most reasonable method based on the availability and reliability of data. Transfer pricing penalties There are two types of penalties associated with a transfer pricing adjustment: an underreporting penalty and an underpayment penalty. • The underreporting penalty is approximately 10% of the additional taxes resulting from a transfer pricing adjustment • The underpayment penalty, which is an interest payment in nature, is calculated as 0.03% of the additional taxes on a transfer pricing adjustment per day (10.95% per annum) on the cumulative days. The counting of cumulative days of the underpayment starts from the day after the statutory tax filing due date, which comes three months after the fiscal year end, and ends on the date that a payment for the tax assessment is made There are certain penalties for failing to comply with information/documentation requests issued by the NTS. A taxpayer must submit information and documents within 60 days of the NTS’ request. A one-time extension of 60 days may be granted, if reasonable circumstances specified in the LCITA exist. Failure to provide documentation requested by the NTS within the required due date, lead to a penalty of up to KRW100 million. See below for further details regarding contemporaneous transfer pricing documentation. Penalty relief Under Article 13 of the LCITA, if the taxpayer has prepared and maintained contemporaneous transfer pricing documentation for the transfer pricing methods applied to the cross-border intercompany transactions reported in the corporate income tax return, and if such documentation supports the reasonableness of the transfer pricing methods reported, the penalty for underreporting will be waived in case a transfer pricing adjustment is made. PED Article 23 of the LCITA provides guidelines on the contents of contemporaneous transfer pricing documentation. In general, contemporaneous transfer pricing documentation should include information on the taxpayer’s business (including functions performed and factors that can affect pricing for intercompany transactions with related parties), details on cross-border intercompany transactions, an explanation of the transfer pricing method selected and reasons for not selecting other transfer pricing methods prescribed in the regulations, and details on the comparable company or transaction data used. The guideline also stipulates that the comparable data used should be representative and not selectively chosen to favor the taxpayer’s position (i.e., no “cherry-picking”). In the case where a taxpayer applies a transfer pricing method different from that agreed in an APA or selected by tax auditors in a tax audit, the taxpayer needs to justify the use of the different transfer pricing method. Worldwide transfer pricing reference guide 275
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Worldwide Transfer Pricing Referenc
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Worldwide transfer pricing referenc
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Nigeria 215 Norway 217 Oman 220 Pak
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The content is current as of 28 Feb
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CUP (comparable uncontrolled price)
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Albania (continued) Priorities/pric
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Algeria Taxing authority and tax la
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Algeria (continued) Return disclosu
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Angola (continued) Transfer pricing
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Argentina Taxing authority and tax
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Argentina (continued) Transfer pric
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Australia Taxing authority and tax
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Australia (continued) Priorities/pr
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Australia (continued) Documentation
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Australia (continued) Frequency of
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Austria (continued) Documentation r
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Bahrain Taxing authority and tax la
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Bangladesh (continued) Penalty reli
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Belgium Taxing authority and tax la
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Belgium (continued) Statute of limi
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Bolivia Taxing authority and tax la
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Botswana Taxing authority and tax l
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Brazil (continued) Relevant regulat
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Brazil (continued) Priorities/prici
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Brunei Taxing authority and tax law
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Bulgaria (continued) Transfer prici
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Bulgaria (continued) Return disclos
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Cameroon Taxing authority and tax l
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Canada Taxing authority and tax law
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Canada (continued) Documentation re
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Chile Taxing authority and tax law
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Chile (continued) Return disclosure
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China (continued) Documentation req
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Colombia Taxing authority and tax l
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Colombia (continued) Penalty relief
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Republic of Congo Taxing authority
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Costa Rica Taxing authority and tax
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Croatia Taxing authority and tax la
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Croatia (continued) Frequency of ta
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Czech Republic Taxing authority and
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Denmark Taxing authority and tax la
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Denmark (continued) Documentation d
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Dominican Republic Taxing authority
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Dominican Republic (continued) Expe
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Ecuador (continued) Priorities/pric
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Ecuador (continued) Return disclosu
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Egypt Taxing authority and tax law
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Egypt (continued) Frequency of tax
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El Salvador (continued) Transfer pr
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Estonia Taxing authority and tax la
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Fiji Taxing authority and tax law T
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Fiji (continued) Frequency of tax a
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Finland (continued) Documentation r
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France (continued) Transfer pricing
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France (continued) Documentation re
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France (continued) Expected reactio
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Gabon (continued) Transfer pricing-
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Georgia (continued) Documentation r
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Germany Taxing authority and tax la
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Germany (continued) For late filing
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Ghana Taxing authority and tax law
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Ghana (continued) APA opportunity T
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Greece (continued) Transfer pricing
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Guatemala Taxing authority and tax
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Honduras Taxing authority and tax l
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Hong Kong (SAR) Taxing authority an
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Hong Kong (SAR) (continued) APA opp
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Hungary (continued) Priorities/pric
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Hungary (continued) Documentation r
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Iceland Taxing authority and tax la
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India Taxing authority and tax law
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India (continued) Documentation req
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Indonesia Taxing authority and tax
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Indonesia (continued) Frequency of
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Ireland Taxing authority and tax la
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Ireland (continued) Frequency of ta
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Israel (continued) Priorities/prici
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Italy Taxing authority and tax law
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Italy (continued) Transfer pricing
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Italy (continued) Frequency of tax
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Japan (continued) Transfer pricing
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Japan (continued) APA opportunity U
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Kazakhstan Taxing authority and tax
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Kazakhstan (continued) Frequency of
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Kenya (continued) Documentation req
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Kosovo (continued) Documentation re
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Kuwait (continued) Documentation re
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Latvia Taxing authority and tax law
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Lebanon Taxing authority and tax la
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Lithuania Taxing authority and tax
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Luxembourg Taxing authority and tax
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Former Yugoslav Republic of Macedon
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Malaysia Taxing authority and tax l
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Malaysia (continued) Frequency of t
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Maldives (continued) Statute of lim
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Malta (continued) Return disclosure
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Mauritius (continued) APA opportuni
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Mexico (continued) Transfer pricing
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Mexico (continued) Return disclosur
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Montenegro (continued) Frequency of
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Morocco (continued) Transfer pricin
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Myanmar Taxing authority and tax la
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Namibia Taxing authority and tax la
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Netherlands Taxing authority and ta
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Netherlands (continued) Statute of
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New Zealand Taxing authority and ta
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New Zealand (continued) Frequency o
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Nigeria Taxing authority and tax la
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Norway Taxing authority and tax law
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Norway (continued) Frequency of tax
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Oman (continued) Frequency of tax a
Page 223 and 224: Panama Taxing authority and tax law
Page 225 and 226: Panama (continued) Expected reactio
Page 227 and 228: Papua New Guinea (continued) Docume
Page 229 and 230: Peru Taxing authority and tax law T
Page 231 and 232: Peru (continued) Frequency of tax a
Page 233 and 234: Philippines (continued) Transfer pr
Page 235 and 236: Poland Taxing authority and tax law
Page 237 and 238: Poland (continued) Transfer pricing
Page 239 and 240: Poland (continued) Return disclosur
Page 241 and 242: Poland (continued) APA opportunity
Page 243 and 244: Portugal (continued) Transfer prici
Page 245 and 246: Portugal (continued) APA opportunit
Page 247 and 248: Qatar (continued) OECD guidelines t
Page 249 and 250: Qatar (continued) Return disclosure
Page 251 and 252: Romania (continued) Documentation r
Page 253 and 254: Russian Federation Taxing authority
Page 255 and 256: Russian Federation (continued) Freq
Page 257 and 258: Saudi Arabia (continued) Transfer p
Page 259 and 260: Senegal (continued) Documentation r
Page 261 and 262: Serbia Taxing authority and tax law
Page 263 and 264: Singapore Taxing authority and tax
Page 265 and 266: Singapore (continued) Frequency of
Page 267 and 268: Slovak Republic (continued) Documen
Page 269 and 270: Slovenia Taxing authority and tax l
Page 271 and 272: Slovenia (continued) Transfer prici
Page 273: South Africa (continued) Penalty re
Page 277 and 278: South Korea (Republic of Korea) (co
Page 279 and 280: Spain (continued) Penalty relief So
Page 281 and 282: Spain (continued) APA opportunity T
Page 283 and 284: Sri Lanka (continued) Return disclo
Page 285 and 286: Sweden (continued) Documentation re
Page 287 and 288: Switzerland Taxing authority and ta
Page 289 and 290: Taiwan Taxing authority and tax law
Page 291 and 292: Taiwan (continued) Return disclosur
Page 293 and 294: Tanzania Taxing authority and tax l
Page 295 and 296: Thailand Taxing authority and tax l
Page 297 and 298: Thailand (continued) Frequency of t
Page 299 and 300: Turkey (continued) Priorities/prici
Page 301 and 302: Uganda Taxing authority and tax law
Page 303 and 304: Ukraine Taxing authority and tax la
Page 305 and 306: Ukraine (continued) Transfer pricin
Page 307 and 308: United Kingdom Taxing authority and
Page 309 and 310: United Kingdom (continued) Transfer
Page 311 and 312: United States (continued) Transfer
Page 313 and 314: Uruguay Taxing authority and tax la
Page 315 and 316: Uruguay (continued) APA opportunity
Page 317 and 318: Venezuela Taxing authority and tax
Page 319 and 320: Venezuela (continued) Expected reac
Page 321 and 322: Vietnam (continued) Relevant regula
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Zimbabwe Taxing authority and tax l
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Zimbabwe (continued) Relevant regul
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Transfer pricing contacts Area cont
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Jurisdiction contacts • El Salvad
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Jurisdiction contacts • Rep. of C
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Worldwide transfer pricing reference guide 2014

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