TP Ticker – June 2018 (3)
Public Comments on Future Revisions of the OECD Guidelines
On 28 June 2018, the OECD published two reports containing the comments received on the scope of future revisions of the transfer pricing guidelines. The comments cover chapter IV on administrative approaches and chapter VII on intra-group services respectively.
The reports can be found on the website of the OECD here: https://www.oecd.org/ctp/transfer-pricing/public-comments-received-on-the-scope-of-the-future-revisions-of-chapter-iv-administrative-approaches-and-chapter-vii-intra-group-services-of-the-transfer-pricing-guidelines.htm
New OECD Guidance on HTVIs and TPSM
On 21 June, the OECD published two new reports containing guidance on hard-to-value Intangibles (“HTVIs”) and the transactional profit split method (“TPSM”). The report on HTVIs provides especially examples of the application of the OECD Guidance’s ex-post approach to pricing intangible transactions and will be incorporated in the OECD Guidelines as an appendix. The report on the application of the TPSM replaces the previous sections on this method in the main text of the guidelines.
The two new reports can be found on the website of the OECD here: https://www.oecd.org/ctp/transfer-pricing/oecd-releases-new-guidance-on-the-application-of-the-approach-to-hard-to-value-intangibles-and-the-transactional-profit-split-method-under-beps-actions-8-10.htm
French Supreme Court Ruling on TP Reassessments and VAT
On 6 June 2018, the French supreme court decided in the case of a transfer pricing reassessment about the question if the reassessed income can be considered for purposes of the French tax on added value of companies (Cotisation sur la Valeur Ajoutée des Entreprises). This tax is levied on the added value of companies and is calculated based on the accounting records of the taxpayers. Based on the argumentation of the Supreme Court, the tax administration can challenge the legitimacy of the accounting records in transfer pricing cases not only for purposes of the income tax but also of the value added tax, resulting in additional tax risk for multinational companies operating in France.
The case is available under No. 409645 on the website of the French Supreme Court here: http://www.conseil-etat.fr/Decisions-Avis-Publications/Decisions/ArianeWeb