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What is Contemporaneous TP Documentation?

Updated: 2 days ago



Preparing Contemporaneous Documentation originated in the United States in the early 1990s.


A taxpayer who fails to provide contemporaneous transfer price documentation within 30 days of the Director General's request will be guilty of an offence under section 113B of the Income Tax Act 1967 beginning on 1 January 2021.


Upon conviction, the taxpayer is subject to fines of not less than RM20,000 and not more than RM100,000 or to imprisonment for a term not exceeding six months or to both. 


The taxpayer may file an appeal with the Special Commissioners of Income Tax when fines are imposed without prosecution [s 113B(5)].


同期转让定价文件的准备,于20世纪90年代初起源于美国。


从2021年1月1日开始,纳税人如果未能在税收局总监要求的30天内提供同期转让定价文件,在1967年所得税法令第113B条下,属于一项罪行。


一经定罪,该纳税人将被处以不少于20,000令吉和不超过100,000令吉的罚款,或被处以不超过6个月的监禁,或两者兼施。 


在不起诉的情况下而被判处罚款,纳税人可以向所得税特别专员提出上诉。



What is contemporaneous Transfer Pricing Documentation?

Suppose a taxpayer's gross income or financial assistance in a related transaction exceeds the threshold established by the Transfer Pricing Guidelines of the Malaysian Inland Revenue Board (MIRB). In that case, they will be required to provide contemporaneous transfer pricing documentation.


Contemporaneous Transfer Pricing Documentation refers to documentation and information that taxpayers have relied upon to determine the pricing of a related party transaction before or when undertaking the transactions with related parties.


In the majority of the countries, taxpayers are expected to have transfer pricing documentation readily available to support the transfer pricing used for an intercompany transaction (s).


It is therefore important that taxpayers make use of the most up-to-date information and data when preparing contemporaneous documentation for transfer pricing.


In actuality, the IRBM will also consider Transfer Pricing Documentation as contemporaneous if it is prepared no later than the due date of the annual tax return for the financial year in which the transactions occurred.


什么是同期转让定价文件?

如果纳税人在关联交易中的总收入或财政援助高于马来西亚税收局《转让定价指南》中所规定的门槛,那么他们就需要准备转让定价的同期文件。


同期转让定价文件是指纳税人在与关联方进行交易之前或进行交易时,为确定关联方交易的定价所依赖的文件和信息。


在大多数国家,纳税人应该有现成的转让定价文件来支持用于集团间交易的转让定价。


因此,在准备转让定价的同期文件时,纳税人必须利用最新的信息和数据。


实际上,如果转让定价文件的准备时间不晚于交易发生的财政年度的年度纳税申报日期,马来西亚税收局一般上也会将其视为同期的转让定价文件。


What are the Master File, Local File, Country-by-Country Reports (CbCR), and special matter documents all about?

Countries participating in the OECD/G20 Base Erosion and Profit Shifting (BEPS) Project published "Guidance on Transfer Pricing Documentation and Country-by-Country Reporting" in September 2014. (the September Report).


The September Report was presented to the G20 Finance Ministers in September 2014 in Cairns, Australia, and the G20 Leaders in November 2014 in Brisbane, Australia.


什么是“主体文件”、“本地文件”、“国别报告”(CbCR)和“特殊事项文件”?

参与OECD/G20税基侵蚀和利润转移(BEPS)项目的国家在2014年9月发布了《转让定价文件和国别报告指南》。(称之为“9月报告“)。


《九月报告》于2014年9月在澳大利亚凯恩斯提交给G20财政部长,并于2014年11月在澳大利亚布里斯班提交给 G20 领导人。




The September Report outlined a standardized, three-tiered approach to transfer pricing documentation.


《九月报告》概述了一个标准化的、三层的转让定价文件的方法。



This approach consists of:-

  1. a Master File containing standardized information relevant for all MNE group members;

  2. a Local File referring specifically to material transactions of the local taxpayer; and

  3. a Country-by-Country Report containing certain information relating to the global allocation of the MNE group’s income and taxes paid together with certain indicators of the location of economic activity within the MNE group (the “CbC Report”).

这种方法包括:-

  1. 一个《主体文件》,包含与所有跨国企业集团成员有关的标准化信息;

  2. 《本地文件》,具体涉及当地纳税人的重大交易;以及

  3. 《国别报告》,其中包含与跨国企业集团收入和纳税的全球分配有关的某些信息,以及跨国企业集团内经济活动地点的某些指标("CbC报告")。

Master File

The Master File should provide an overview of an MNE’s global operations, a master file with high-level information regarding a multinational enterprise’s (MNE group) global business operations and transfer pricing policies, main contents should include the MNEs':


👉 Organizational structure

👉 Description of its’ business or businesses

👉 Intangibles

👉 Intercompany financial activities

👉 Financial and tax positions


主体文件

主体文件应提供一个跨国企业全球业务的概况,它包含了有关跨国企业集团全球业务运作和转让定价政策的高层次信息,主要内容应包括跨国企业的:


  • 组织结构

  • 描述其业务或业务

  • 无形资产

  • 公司间的财务活动

  • 财务和税务状况


Local File

Local File mainly discloses the detailed transactional transfer pricing documentation specific to each jurisdiction, and the main contents include:


👉 Enterprise overview

👉 Related parties

👉 Related transactions

👉 Comparability analysis

👉 Selection and application of transfer pricing methods.


Local File often also requires disclosure:

👉 Value chain analysis

👉 Foreign investments

👉 Related equity transfers, and Intra Group Services


本地文件

本地文件主要披露各司法管辖区特有的详细交易转让定价文件,主要内容包括:-


👉 企业概况

👉 关联方

👉 相关交易

👉 可比性分析

👉 转让定价方法的选择和应用。


本地文件通常也要求披露:

  • 价值链分析

  • 外国投资

  • 相关的股权转让,以及集团内部的服务


Then, what about the purpose of Country-by-Country Reports (“CbCR”)?

BEPS Action 13 Guidance Implementation TP Documentation CbCR
.pdf
Download PDF • 547KB


A Country-by-Country Report that provides annually and for each tax jurisdiction in which an MNE group does business the amount of revenue, profit before income tax, and income tax paid and accrued.


CbCR is useful for the initial assessment of transfer pricing risks, to assist in assessing their exposure to BEPS, and, where appropriate, for economic and statistical analysis.


However, it is important to note that the information in the Country-by-Country Report cannot be used as a replacement for the transfer pricing analysis function.


For specific transaction and transfer pricing analysis, it still should be based on a complete Functional Analysis and Comparability Analysis.


那么,国别报告("CbCR")的目的是什么?

它提供每年为跨国企业集团开展业务的每个税收管辖区提供收入、所得税前利润以及已付和应计所得税的数额。


《国别报告》可用于初步评估转让定价风险,帮助评估其对 BEPS 的敞口,并在适当的情况下进行经济和统计分析。


然而,需要注意的是,《国别报告》中的信息不能作为转让定价功能分析的替代。


对于具体的交易和转让定价分析,仍应以完整的功能分析和可比性分析为基础。



Referring to the Malaysian Transfer Pricing Guide 2012, you may notice that Contemporaneous Document seems to include some other documents, which I called ‘special matters documents’, mainly including:


👉 Cost Contribution Arrangement

👉 Intra Group Services

👉 Intangible Properties

👉 Intragroup Financing


'Earnings Stripping Rules (Thin Capitalization Rules)' is an additional document not in the guide that I deem to be of equal importance.


Ensuring compliance with the requirements for transfer pricing documentation is challenging—but not impossible.


参照《2012年马来西亚转让定价指南》,你可能会注意到,转让定价同期文件似乎包括一些其他文件,我称之为 "特殊事项文件",这主要包括:-


👉 成本分摊协议

👉 集团内部服务

👉 无形资产

👉 集团内部融资


"收益剥离细则(资本弱化细则) " 在指南中虽然没有被提及,但我认为它具有同等重要。


确保遵守转让定价文件的要求是具有挑战性的,但并非不可能。


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