Worldwide transfer pricing reference guide 2014

Zimbabwe (continued)
Relevant regulations and rulings (continued)
• The Commissioner may adjust the income accruing from any transfer or license of intangible property between associates or persons
in an employer-employee relationship so that it is commensurate with the income attributable to the property
• In making the adjustment the Commissioner may re-characterize the source of income and the nature of any payment or loss as
revenue, capital or otherwise
• Income splitting
• Where an individual attempts to split income with an associate, the Commissioner may adjust the taxable income of the taxpayer and
the associate to prevent any reduction in tax payable as a result of the splitting
OECD Guidelines treatment
Guidance may be sought from the OECD Guidelines where the methods are considered appropriate.
Priorities/pricing methods
The OECD pricing methods and the transaction methods like the CUP and Cost Plus are preferred.
Transfer pricing penalties
There are no specific penalties for transfer pricing but general penalty rules apply, that is, 100% penalties that can be negotiated
provided the justifications are accepted by the ZIMRA.
Penalty relief
There is an internal general penalty loading model that is used by the ZIMRA which reduces the 100% and is affected by the level of
cooperation of the taxpayer, culpability and/or the gravity of the offence. Therefore penalties can be negotiated provided justifications
are available for consideration by the ZIMRA.
Voluntary disclosures and “good faith” do not necessarily lead to penalty relief.
Documentation requirements
There is no specific transfer pricing documentation regulations. But the taxpayer has to show adequate documentation that the
prices are at arms’ length and services have been performed and/or charges have been incurred. Generally documentation including
information other than financial information on prices and pricing policy is to be provided.
Documentation deadlines
There are no documentation deadlines. However, in the event of a request by the ZIMRA, time limits are generally specified for the
submission of documents.
Statute of limitations on transfer pricing assessments
No specific transfer pricing assessments and limits thereto, but the general assessment limits apply, that is, six years from the date of
assessment where full disclosure was made in the tax return and accounts, or for infinite period where there is misrepresentation or
fraud or willful non-disclosure.
Return disclosures/related party disclosures
Not requested in the tax return.
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