Implications of Secondary adjustment – An Indian Analysis

The concept of arm’s length price is the cornerstone of transfer pricing. It provides that a transaction entered into between two or more entities of the same group shall not be influenced by the relationship of the transacting parties and therefore shall adhere to the generally accepted pricing and trade policies. Continue reading

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India TP paradigm sift: Introduction of Secondary Adjustments

India TP paradigm sift: Introduction of Secondary Adjustments

The Hon’ble Finance Ministry Shri Arun Jaitley, in his historic budget, introduced, much to the relief of the Multinational Companies operating from India, the concept of secondary adjustment by way of inserting new Section 92CE under chapter X in the Income Tax Act.

Introduction Continue reading

Income Tax – New Related Party Transaction Reporting Requirement (Effective from YA 2018) — SingaporeTaxConsulting.com

With effect from Year of Assessment (“YA“) 2018, IRAS will be introducing a new Related Party Transaction (“RPT“) reporting requirement for companies which would assist IRAS in better assessing their transfer pricing risks and enforcing the arm’s length requirement. New Reporting for RPT Keeping in mind the additional compliance costs, companies are required to complete […]

via Income Tax – New Related Party Transaction Reporting Requirement (Effective from YA 2018) — SingaporeTaxConsulting.com

New transfer pricing developments bring new risk for New Zealand multinationals

The Inland Revenue Department (“IRD”), as we expect, is continuing its work tightening the so called “loopholes” in New Zealand’s (“NZ’s”) current tax regime for multinational enterprises (“MNE’s”). Following continued public and media scrutiny, the IRD have introduced several measures as part of the rollout of the OECD’s action plan to combat the base erosion and profit shifting (“BEPS”) of its member countries tax base. Continue reading

Controversy over interpretation of MFN clause

Introduction

The most-favoured nation (‘MFN’) clause is a time-tested concept of international trade and diplomacy. Such clauses are generally negotiated to ensure that residents of a particular country should not be treated less favourably in comparison to residents of another country or a group of other countries. Since the treaty negotiation process involves an array of social, political, economic and diplomatic factors, each country endeavours to obtain maximum tax concessions for its residents in comparison to the residents of other countries. In the context of tax treaties, MFN clauses can often be found incorporated by way of a protocol to the treaty. Continue reading

Identification of TP comparables for regulated industries

A regulatory authority is a public authority or government agency responsible for exercising autonomous authority over some area of human activity in a regulatory or supervisory capacity. They are usually a part of the executive branch of the government and they have statutory authority to perform their functions with oversight from the legislative branch. Regulatory authorities are commonly set up to enforce standards and safety or to oversee use of public goods and regulate commerce. Some examples of regulatory authorities are the Food and Drug Administration (responsible for protecting and promoting public health) in the United States, the Ofcom (regulator of the broadcasting, telecommunications and postal industries) in the United Kingdom and the Telecom Regulatory Authority (regulator of telecommunications industry) in India. Continue reading