Introduction
This article provides a high-level overview of some of the common business models used by local entities that are engaged in the distribution, sale and marketing of their group s products and analyses the potential transfer pricing ramifications thereof.
The transfer pricing analysis included in this article is predominantly based on Circular 11/2018 (Determination of the appropriate transfer pricing method for activity related to distribution, marketing and sales of a multinational group within the local market),(1) published by the Israeli Tax Authority (ITA). Circular 11/2018 implements the Organisation for Economic Cooperation and Development (OECD) Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations 2017 (OECD guidelines).
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Just in time for the holidays, the OECD has published
detailed guidance about the impact of the COVID-19 pandemic on
transfer pricing. The guidance has useful information for taxpayers
and tax administrations alike. It contains general advice on the
application of basic transfer pricing principles during the
pandemic, as well as specific advice on four issues: (i)
comparability analyses, (ii) allocating losses, (iii)
government-assistance programs, and (iv) advance pricing
arrangements ( APAs ). The OECD guidance is broadly
consistent with comments we made in
a prior post about the impact of the pandemic on transfer
2020-12-24 17:35:56
Ulaanbaatar /MONTSAME/. On 23 December 2020, General Taxation Authority of Mongolia issued a press statement regarding the tax audit of Oyu Tolgoi LLC. The statement reads: Similar to many other countries’ designated tax administrators, the Mongolian Tax Authority (“MTA”) conducts a periodic audit of tax returns filed by companies within its jurisdiction to ensure the proper application of domestic tax laws and the satisfactory compliance of certain international transfer pricing principles, such as the OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations and Actions 8-10 of the BEPS Framework (the “
International Rules”).
The MTA has recently completed an audit of Oyu Tolgoi LLC’s 2016-2018 tax returns and identified a number of violations and breaches of relevant laws and the International Rules. As a result, Oyu Tolgoi LLC was notified of MNT 649.4 billion (approximately US$228 million) of add
Mexico s Reportable Transactions Rules in Effect January 1 Monday, December 21, 2020
Beginning January 1, 2021, Mexico’s reportable transaction rules require either a taxpayer or a tax advisor to report to the Mexican tax authorities any transactions that are designed, marketed, organized, implemented or administered to provide a tax benefit to the taxpayer.
What is a Reportable Transaction?
A reportable transaction is considered to be any transaction that generates or may generate, directly or indirectly, a tax benefit in Mexico and has any of the following characteristics:
Prevents foreign authorities from exchanging tax or financial information with Mexican tax authorities.
Avoids the application of the preferential tax regime (“REFIPRE”) or of transparent tax entities and foreign instruments.
OVERVIEW
Beginning January 1, 2021, Mexico’s reportable transaction rules require either a taxpayer or a tax advisor to report to the Mexican tax authorities any transactions that are designed, marketed, organized, implemented or administered to provide a tax benefit to the taxpayer.
IN DEPTH
What is a Reportable Transaction?
A reportable transaction is considered to be any transaction that generates or may generate, directly or indirectly, a tax benefit in Mexico and has any of the following characteristics:
Prevents foreign authorities from exchanging tax or financial information with Mexican tax authorities.
Avoids the application of the preferential tax regime (“REFIPRE”) or of transparent tax entities and foreign instruments.