Transfer pricing bytes
Notification on content of transfer pricing files published
Following the enactment of transfer pricing legislation on 30 June 2022, the Cyprus tax authorities recently published in the Official Gazette a notification that provides guidance on the country’s transfer pricing documentation requirements. The notification, effective as of 1 January 2022, addresses the master file and local file, as well as the Summary Information Table regarding information on related-party transactions.
Pascal Saint-Amans to leave Centre for Tax Policy and Administration
The OECD on 5 September 2022 released a statement by the Secretary-General of the Centre for Tax Policy and Administration announcing that Pascal Saint-Amans will retire from the organisation at the end of October 2022.
Saint-Amans spent 15 years at the OECD, including 10 years as Director of the Centre for Tax Policy and Administration (CTP). In 2012, he launched the Base Erosion and Profit Shifting (BEPS) Project, and in 2021 he brokered the landmark agreement among 137 countries and jurisdictions on the two-pillar solution to the tax challenges arising from the digitalisation and the globalisation of the economy.
He also led the establishment of automatic exchange of financial account information as a global standard in 2014, and together with the United Nations Development Programme, established the Tax Inspectors without Borders programme.
Grace Perez-Navarro will assume the role of Director of the CTP from 1 November 2022 until 31 March 2023. David Bradbury, who has served as the Head of the Tax Policy and Statistics Division since 2014, and Achim Pross, who has been the Head of the International Co-operation and Tax Administration Division since 2011, will serve as Acting Deputy Directors of the CTP.
Changes to transfer pricing rules proposed
The Zakat, Tax and Customs Authority recently held a public consultation on proposed changes to the transfer pricing bylaws. The transfer pricing bylaws currently are applicable to income taxpayers and taxpayers subject to both income tax and Zakat; entities subject exclusively to Zakat only have to comply with country-by-country reporting obligations, when applicable. It is proposed to bring 100% Zakat payers within the scope of the bylaws by revising the definition of “taxable persons.”
Other changes include (i) revising the definition of “related persons” to include persons with the ability to effectively control the business; (ii) requiring all Zakat payers (except individuals and “small enterprises”) to maintain transfer pricing documentation (local and master files) and provide it to the tax authorities upon request (small enterprises are juridical persons that carry out controlled transactions for which the total arm’s length value does not exceed SAR 6 million (around USD 1.6 million) in a 12-month period); and (iii) requiring Zakat payers to submit the controlled transactions disclosure form within 120 days of the end of the financial year, along with the Zakat/tax annual return.