Transfer Pricing In Malaysia

What exactly is meant by "Transfer Pricing"?

The price of international and domestic intragroup transactions between connected parties that involve the transfer of goods, services, or intangibles is referred to as "Transfer Pricing."

Therefore, "Transfer Pricing" is an umbrella word for pricing these types of transactions.

"转让定价"究竟是什么？

关联方之间涉及货物、服务或无形资产转让的国际和国内集团内交易的价格被称为 "转让定价"。

因此，"转让定价"就是对这些类型的交易定价的一个总称。

Manipulation of transfer pricing, often known as "mispricing," "incorrect pricing," "unjustified pricing," or "non-length arm's pricing," can lead to tax avoidance or evasion.

对转让定价的操纵，通常被称为 "错误定价"、"不正确定价"、"不合理定价 "或 "非长度臂定价"，可导致避税或逃税。

Legislation

In order to particularly address transfer pricing issues, Section 140A of the Income Tax Act 1967 (the "ITA") was amended in 2009 to include a provision that required taxpayers to determine and apply the price that would have been charged to controlled transactions.

The DGIR is authorised to make adjustments on controlled transactions of goods, services, or financial assistance based on the arm's length principle owing to Section 140A of the ITA.

The Administrative Requirements of the Application of Section 140A of the ITA and the Income Tax (Transfer Pricing) Rules 2012 are explained by the Transfer Pricing Guidelines 2012, which was released in July 2012 by the Malaysian Inland Revenue Board (MIRB). The OECD Guidelines are followed closely and used as a basis for these guidelines.

立法

为了特别解决转让定价问题，《1967年所得税法令》（"ITA"）第140A条于2009年进行了修订，加入了一项规定，要求纳税人针对受控交易，鉴定应采用的价格。

由于《1967年所得税法令》第140A条的规定，内陆税收局总监 (“DGIR") 被授权，按照公平交易原则对货物、服务或财务援助的受控交易进行调整。

马来西亚内陆税收局（”MIRB“）于2012年7月发布的《2012年转让定价指南》解释了适用《1967年所得税法令》第140A条和《2012年所得税（转让定价）细则》的执行要求。

经合组织所发布的指南，被密切关注并被用作上述指南的基础。

To put it more succinctly, taxpayers are expected to demonstrate that the transactions between related parties are carried out consistently with transactions involving third parties.

This means that the transactions must be conducted at arm's length.

Therefore, the taxpayer needs to prepare transfer pricing documentation to prove this fact.

简而言之，纳税人应证明关联方之间的交易是与涉及第三方的交易一致的。

这意味着这些交易必须是按公平交易进行的。

因此，纳税人需要按照要求准备转让定价文件，以证明这一事实。

As a result, beginning with the year of assessment in 2014, it turned into a need for all companies to affirm the availability of their transfer pricing documents to support any necessarily related party transactions.

Therefore, all taxpayers with any related party transactions will have to comply with the obligation to prepare and maintain their transfer pricing documentation when filing their income tax returns each year.

从2014年的评估年度开始，所有公司需要确认其转让定价文件的可用性，以支持任何必然的关联方交易。

因此，所有有任何关联方交易的纳税人，每年在提交所得税申报时，都得确保遵守准备和保留其转让定价文件的义务。

With effect from 1 January 2019

Under Section 140A (5A) of the ITA, “control” refers to persons one of whom owns shares of the other person or a third person who owns shares of both persons, where the percentage of the share capital held in either situation is 20% [Before - 50%] or more and—"

1. the business operations of that person depending on the proprietary rights, such as patents, non-patented technological know-how, trademarks, or copyrights, provided by the other person or a third person;

2. the business activities, such as purchases, sales, receipt of services, and provision of services, of that person are specified by the other person, and the prices and other conditions relating to the supply are influenced by such other person or a third person; or

3. where one or more of the directors or members of the board of directors of a person are appointed by the other person or a third person.

自2019年1月1日起生效

根据《1967年所得税法令》第140A（5A）条，"控制 "是指其中一方拥有另一方的股份，或第三方拥有两方的股份，在任何一种情况下持有的股本20% [之前 - 50%] 或以上，并且-"

1. 该方的业务活动依赖于专利、非专利技术知识、商标或版权等所有权，这些权利是由对方或第三方提供的。

2. 该方的商业活动，如采购、销售、服务的接受或服务的提供，是由该方指定的，而且与供应有关的价格和其他条件是由该方或第三方影响的；或

3. 一方的一名或多名董事或董事会成员是由另一方或第三方任命的。

Examples of control and associated persons

控制和相关方的例子

In this example, Company A controls Company B and Company C through share ownership.

As Company A controls both Company B and Company C, Companies B and C are associated enterprises.

Therefore, transfer pricing laws apply to transactions between the two.

在这个例子中，A公司通过股份所有权控制B公司和C公司。

由于A公司同时控制B公司和C公司，B公司和C公司是关联企业。

因此，转让定价法适用于这两者之间的交易。

Company A controls Company B, which in turn controls Company C.

Company A thus indirectly controls Company C, and transfer pricing laws thus apply to transactions between them.

A公司控制B公司，而B公司又控制C公司。

因此，A公司间接控制C公司，转让定价法因此适用于他们之间的交易。

The Act provides that transactions between Company A and Company B are deemed controlled transactions due to the relationship between Mr. X and Mrs. X.

本法规定，A公司和B公司之间的交易被视为受控交易，因为X先生和X女士之间的关系。

Tax Audit Frameworks

On 15 December 2019, the Malaysian Inland Revenue Board (“IRB”) issued the updated Tax Audit Frameworks, which includes the Transfer Pricing Audit Framework 2019.

The updated tax audit frameworks take effect from 15 December 2019.

The 2019 TP Audit Framework introduced several key changes that can impact taxpayers and increase the total value of a transfer pricing adjustment significantly.

税务审计框架

2019年12月15日，马来西亚税收局（"IRB"）发布了更新的税务审计框架，当中就包括来2019年转让定价审计（"Transfer Pricing Audit"）框架。

更新后的税务审计框架从2019年12月15日起生效。

2019年年转让定价审计框架引入了几个关键的变化，这些变化会影响纳税人，并大大增加转让定价调整的总价值。

Finance Act 2020

The Act amended certain transfer pricing (TP) provisions of the ITA, and effective from Jan 1, 2021:

• Taxpayers that fail to submit the contemporaneous TP documentation within 14 days (Before - 30 days) upon request by the IRB can be fined between RM20,000 and RM100,000 and/or to imprisonment for a term not exceeding six months.

• The Director-General is empowered to impose a surcharge of 5% if it is found that the related party transactions are not conducted at arm's length.

• The Director-General is empowered to disregard and re-characterise the structure in a controlled transaction where:

+ The economic substance differs from form; or

+ The arrangement lacks commercial rationale.

All the above have been enacted under the Finance Act 2020 and Gazetted on 31 December 2020.

《2020年财政法》

本法修订了《1967年所得税法令》的与转让定价（TP）相关的一些条款，并自2021年1月1日起生效:

• 如果纳税人未能在内陆税收局 (IRB) 要求的14天 [之前 - 30天] 内提交同期的转让定价文件，可被处以 20 千至 100 千令吉的罚款和/或不超过6个月的监禁。

• 如果发现关联方交易不是建立在公平交易原则下，税收局总监有权征收5%的附加费。

• 在下列情况下，总监有权不接纳关联方之间的交易结构，并重新鉴定受控交易的结构：

+ 经济实质与形式不同；或

+ 该安排缺乏商业合理性。

所有上述内容已根据《2020年财政法令》颁布，并于2020年12月31日在公报中公布。

When are you at risk?

The way the IRB focuses on transfer pricing in Malaysia means that every Company especially MNE with controlled transactions is at risk of transfer pricing scrutiny.

Transfer pricing guidelines are applicable when at least one party is assessable or chargeable to tax in Malaysia.

All Companies run an extra risk of an audit if one of the following situations applies:

• Repeating low margins or losses

• Many high-value transactions

• Large deviations in profit and loss histories

• Reporting a low EBIT compared to the industry’s average

• Reporting a low EBIT compared to comparable enterprises

你什么时候将面临风险？

在马来西亚，内陆税收局关注转让定价意味着每家公司，尤其是有受控交易的跨国企业，都有可能受到转让定价审查。

当至少有一方在马来西亚应被评估或征税时，转让定价准则才适用。

如果出现以下情况，所有公司都会有被审计的额外风险：

• 重复的低利润或亏损

• 许多高价值的交易

• 过去的利润和亏损出现巨大的偏差

• 与行业平均水平相比，财务报告的息税前利润较低

• 与可比较的企业相比，财务报告的息税前利润较低

What are your Transfer Pricing obligations in Malaysia?

Based on the existing transfer pricing guidelines, taxpayers with gross income exceeding RM25mil where their related party transactions exceed RM15mil must prepare complete and detailed transfer pricing documentation.

It is highly recommended that, at the very least the simplified [limited] version as per the guidelines is kept on file for taxpayers whose gross income and related party transaction values do not exceed RM25mil and RM15mil, respectively.

在马来西亚，你有些什么转让定价的义务？

根据现有的转让定价指南，总收入超过2500万令吉的纳税人，如果其关联方交易超过1500万令吉，就必须准备完整和详细的转让定价文件。

对于总收入和关联方交易额分别不超过2500万令吉和1500万令吉的纳税人，建议按照指南准备简化 [有限] 版本的文件。

General Documentation requirements

Malaysia has well-defined and extensive transfer pricing documentation requirements.

Transfer pricing documentation should include records and documents describing:

• The organizational structure includes an organization chart covering persons involved in a controlled transaction;

• The nature of the business or industry and market conditions;

• Details of the related party transaction;

• Strategies, assumptions, and information regarding factors that influenced the setting of any pricing policies;

• Comparability, functional, and risk analysis;

• Selection of the transfer pricing method;

• Application of the transfer pricing method;

• Documents used in developing the transfer pricing analysis;

• Index to documents;

• Any other information, data, or document considered relevant by the person to determine an arm’s-length price.

All relevant documentation must be provided in Bahasa Malaysia or English.

一般文件要求

马来西亚税收局有明确、广义的转让定价文件要求。

转让定价文件应包括描述以下内容的记录和文件：

• 组织结构包括涵盖参与受控交易方的组织结构图;

• 业务或行业的性质和市场条件;

• 关联方交易的细节;

• 影响任何定价政策制定的策略、假设和因素的信息;

• 可比性、功能性和风险分析;

• 转让定价方法的选择;

• 转让定价方法的应用;

• 用于制定转让定价分析的文件;

• 文件的索引;

• 任何其他被认为与确定正常价格有关的信息、数据或文件。

所有相关文件必须以马来语或英语提供。

Simplified Version of Transfer Pricing Documentation

For a simplified [limited] version, Transfer pricing documentation should include records and documents describing:

• The organizational structure includes an organization chart covering persons involved in a controlled transaction;

• Details of the related party transaction;

• Strategies, assumptions, and information regarding factors that influenced the setting of any pricing policies.

简化版的转让定价文件

对于简化 [有限] 版本，转让定价文件应包括描述以下内容的记录和文件:

• 组织结构包括涵盖参与受控交易方的组织结构图；

• 关联方交易的细节；

• 影响任何定价政策制定的策略、假设和因素的信息。

Do you want to be sure about your transfer pricing in Malaysia is based on the arm's length principle?

Does your Company has controlled transactions, and do you want to be sure you charge the right prices?

To avoid the risks that come with failing to comply with the Transfer Pricing Regulations in Malaysia, it is imperative to enlist the services of an experienced professional agency that will be able to guide you through all the regulatory requirements efficiently.

The transfer pricing documentation can be prepared in the Master file and Local file format in accordance with the OECD BEPS Action 13 requirements.

你想确认你在马来西亚的转让定价是否建立在公平交易原则上吗？

你的公司是否有受控制的交易，你是否想确保你收取正确的价格？

为了避免因未能遵守马来西亚转让定价法规而带来的风险，当务之急是寻求经验丰富的专业机构的服务，他们将能够指导你有效地完成所有的监管要求。

转让定价文件可以根据经合组织 BEPS 行动 13 的要求，以主文件和本地文件的格式准备。

Fee Quote

We provide a fee quote upon request and based on information received.

We price our transfer pricing documentation services based on estimated work and time required to provide the highest quality service and also in view of building the long-term client relationship.

We believe that our pricing is fair and competitive.

Please contact us for more details and a fee quote.

费用报价

我们根据要求和收到的信息提供费用报价。

我们根据提供最高质量服务所需的估计工作和时间为转让定价文件服务定价，同时也考虑到建立长期客户关系。

我们相信，我们的定价是公平和有竞争力的。

如果想要了解更多细节和费用报价，欢迎与我们联系。

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