- Transfer pricing affects not only corporate income tax but also VAT and customs duties in cross-border transactions between related parties.
- There is limited guidance from VAT and customs authorities on how transfer pricing adjustments impact the value of supplies for VAT and customs purposes, leading to uncertainty for taxpayers.
- VAT and customs regimes require contemporaneous valuations and often do not accept retroactive corrections, unlike corporate income tax.
- Differences between OECD transfer pricing guidelines and customs valuation rules can result in double taxation or disputes over transaction values.
- Retrospective transfer pricing adjustments can complicate VAT and customs calculations, especially for goods already imported or services already supplied.
Source: hillierhopkins.co.uk
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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