5 Questions To Ask When Reviewing TP Documentation Compliance

  1. What type of documentation do you exactly need to have for each country? This could include an OECD master and local file or country-specific report similar to a master or local file, a Country-by-Country Report (CbCR), CbCR reporting notifications, and transfer pricing-related tax return forms.
  2. What are the country-specific content requirements for each type of documentation? Each country may have a list of information they’d like to see in your documentation.
  3. Do you need to have the report ready and submit when tax authorities ask for it or do you need to file the documentation at a certain date without tax authorities asking for it? In the former case, the relevant date of completion of the analysis or the report may depend on the timing of the transaction under analysis, contemporaneous requirements (often) linked to the tax return submission date, or the time given to submit the report. Meeting the relevant deadlines is often crucial to avoid late filing and transfer price adjustment penalties.
  4. By when do you need to have the reports prepared or filed? Note that during the current pandemic tax authorities may have extended tax return and transfer pricing-related deadlines.
  5. How high is the cost of non-compliance and the associated penalties according to country-specific regulation? Here it is important to pay attention to the size of your group’s transactions and any thresholds indicated by local requirements.



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