in association with: Welcome to TRANSFER PRICING Prof Dr Daniel N Erasmus, EA & USTCP, International Tax Attorney TRM Daniel Erasmus Tax Court Practitioners Prof Dr Daniel N Erasmus, EA, USTCP & Int’l Tax Attorney +1 561 568 7115
CONTENTS } ADMIN QUERIES: lesia@iitf.net } A. BACKGROUND LEGAL SYSTEMS } B. CASE LAW ONLINE } C. DTA’s between TP States } D. OECD TP Guidelines & UN PRAC TP MANUAL } E. LEGISLATION – in country } F. OTHER RELEVANT TREATIES & LEGISLATION } G. CASE STUDY
What does TP typically apply to? } Cross-border transactions } Domestic transactions sometimes eg. Nigeria } Between “associated enterprises” or “connected persons” } Incl: } HO & Branches } HO & Permanent Establishments } THEN “arm’s length” standard or test applies: } Is there an obligation? } Is there a discretion?
A. BACKGROUND LEGAL SYSTEMS } Victor Thuronyi } Comparative Tax Law in CAMPUS } Page 23 different legal systems } Page 43 country by country Prof Dr Daniel N Erasmus, EA & USTCP +1 561 568 7115
B. CASE LAW ONLINE Ø Kenya Unilever transfer pricing case (Africa) Ø www.commonlii.org Ø www.law.cornell.edu Ø USA IRS site Ø www.saflii.org Ø www.africalii.org Ø www.worldlii.org Ø www.chinalii.net Ø China transfer pricing Ø PWC International Transfer Pricing 2015/2016 Prof Dr Daniel N Erasmus, EA & USTCP +1 561 568 7115
C. DOUBLE TAX TREATIES or AGREEMENTS between TP affected States } OECD Model Tax Convention 2010 } Article 5 Permanent Establishments } Article 7 Taxation of Business Profits } Article 9 Taxation of Associated Enterprises } Article 24 Eliminate tax discrimination – see WTO & BIT } Article 25 MAP } Article 26 The Exchange of Information } BEPS Action 15 Multilateral Instrument Prof Dr Daniel N Erasmus, EA & USTCP 561 568 7115
D. OECD TRANSFER PRICING GUIDELINES & UN PRAC TP MANUAL Ø Soft Law Ø OECD TP GUIDELINES Ø Beps actions Ø Actions 8 – 10 on Transfer Pricing Ø Action 13 Transfer Pricing Documentation Ø 2017 United Nations Practical Manual on TP for Developing Countries (most States are members) Prof Dr Daniel N Erasmus, EA & USTCP 561 568 7115
E. LEGISLATION – in country Ø Specific Transfer Pricing provision Ø General anti-avoidance provisions Ø “associated enterprise” definition – domestic law Ø “arm’s length” definition – soft law Ø TP affects: Ø Goods Ø Services Ø Intangible Assets Ø Financial transactions like loans Prof Dr Daniel N Erasmus, EA & USTCP 561 568 7115
F. OTHER RELEVANT TREATIES & LEGISLATION Ø Constitution (eg. SA) Ø administrative action Ø lawfulness, reasonableness & fairness Ø influence of foreign law Ø status of international treaties (DTA’s) Ø Are Transfer Pricing provisions constitutional? Prof Dr Daniel N Erasmus, EA & USTCP 561 568 7115
F. OTHER RELEVANT TREATIES & LEGISLATION continued Ø Administrative Law (eg. SA & PAJA) Ø eg. Promotion of A dministrative Justice Act, 2000 Ø fair notice of administrative action Ø audi alteram partem rule Ø proper reasons for administrative action Ø remedies Ø internal processes Ø s 6 of PAJA eg. of transgressions Ø Administrative CHAPTER IV in OECD Guidelines Prof Dr Daniel N Erasmus, EA & USTCP 561 568 7115
F. OTHER RELEVANT TREATIES & LEGISLATION continued Ø Vienna Convention signatories Ø international customary law created by DTA’s Ø internal law cannot be used to justify failure to perform a treaty (Article 27) Ø Bilateral Investment Treaties Ø not less favourable treatment Ø Mauritius/South Africa BIT Ø country level fight Ø WTO (GATT & GATS) Ø more favourable treatment Ø country level fight Prof Dr Daniel N Erasmus, EA & USTCP 561 568 7115
G. CASE STUDY Ø Pick another country your company does business with Ø Find the Constitution and any administrative law provisions Ø Find any Administrative Law legislation Ø Find any Transfer Pricing related case law (leading cases by highest courts) Ø Find Transfer Pricing provisions in the Income Tax Act Ø Find Anti- Tax Avoidance provisions in the Income Tax Act Ø Browse Deloitte Country Summaries Ø Peer review Prof Dr Daniel N Erasmus, EA & USTCP 561 568 7115
Thank you } Prof Dr Daniel N. Erasmus } daniel@TaxRiskManagement.com } +1 561-568-7115 } www.TaxRiskManagement.com Prof Dr Daniel N Erasmus, EA & USTCP 561 568 7115
Recommend
More recommend
