Page 40 - Central and Eastern European Transfer Pricing Review

40 | CEE Transfer Pricing Review

Macedonia

KPMG's Views on Transfer Pricing in Macedonia

Macedonian transfer pricing rules have been strengthened in the last few
years. The amendments to the Corporate Income Tax (CIT) Law from April 2011
introduced a separate sub-category of a tax base which referred to overstated
expenses and understated revenues from transactions with related parties.
Later in December of the same year, the amendments to the Rulebook on the
application of the CIT Law (the Rulebook) on the application of the CIT Law
introduced the arms length principle as well as the requirement for taxpayers at
the request of the tax authorities to present satisfactory information and evidence
which would confrm that related-party transactions have been carried at arms
length. Accordingly, it is expected that transfer pricing will become one of the focal
points of the Macedonian tax authorities in the coming years.

Basic information related if one has at least a 10 percent Transfer pricing
interest in the other, or if one party
Tax authority name directly or indirectly has controlling disclosure overview
Министерство за финансии infuence over the other. Are disclosures related to transfer
(Ministry of Finance) pricing required to be prepared or
It is deemed that a company exersises submitted to the revenue authority
Управа за Јавни Приходи a controlling infuence over another on an annual basis (e.g. with the tax
(Public Revenue Offce) company if that company holds, directly return)?
or indirectly, over 40 percent of the total
Citation for transfer pricing rules number of votes that can be cast at the No, a taxpayer is not obliged to prepare
Articles 13 and 14 of the Corporate shareholders meeting, and if no other and submit documentation to the tax
Income Tax Law; article 2 paragraph 4 of shareholder directly or indirectly holds authorities.
the Rulebook on the application of the a number of votes which is greater What types of transfer pricing
CIT Law. than the votes held by the respective information must be disclosed?
company.
Effective date of transfer pricing Not applicable.
rules What is the statute of limitations
Certain provisions have been present in on assessment of transfer pricing What are the consequences
of failure to prepare or submit
the CIT legislation since January 1994, adjustments? disclosures?
while the latest amendments relating to The statute of limitation is set at 5 years,
transfer pricing came into force in 2011. and commences as of 1 January of the Not applicable.
year following the year when the tax
What is the relationship threshold liability became due. If the tax authorities Transfer pricing study
for transfer pricing rules to apply bring a tax administrative act, a new
between parties? statute of limitation of 5 years begins to overview
The CIT Law refers to the Macedonian elapse. The absolute statute of limitation Is preparation of a transfer pricing
Law on Trading Companies for the is set at 10 years. study required i.e. can the
defnition of related parties to which taxpayer be penalized for mere
transfer pricing rules apply, according to There is no special statute of limitations failure to prepare a study?
which two parties will be considered as in respect of transfer pricing. A taxpayer is obliged to present

satisfactory information and evidence

© 2013 KPMG Central and Eastern Europe Ltd., a limited liability company and a member firm of the KPMG network of independent member firms affiliated
with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved.