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        52 | CEE Transfer Pricing Review












        What types of transfer pricing      taxable proft). Interest and late   If there is no priority of methods,
        information must be disclosed?      payment penalties may also apply to the   is there a best method rule?
        Not applicable.                     additional corporate tax due.       No.
                                            Performing a transfer pricing study offers
        What are the consequences           taxpayers the possibility to observe   Transfer pricing audit
        of failure to prepare or submit     the market level for similar comparable
        disclosures?                        companies and thus to correct its prices   and penalties
        Not applicable.                     if any advantages are noted.        When the tax authority requests
                                                                                a taxpayer s transfer pricing
        Transfer pricing study              To satisfy the requirement and/or   documentation, how long does
        overview                            obtain the benefts, are there any   the taxpayer have to submit its
                                            requirements on when the transfer
                                                                                documentation?
        Is preparation of a transfer pricing   pricing study must be prepared and   Based on the local legislation, the
        study required  i.e. can the        submitted?                          transfer pricing documentation fle needs
        taxpayer be penalized for mere      The transfer pricing documentation fle   to be submitted to the tax authorities
        failure to prepare a study?         must be drafted and submitted to the tax   upon their written request. From the date
        Yes, for all transactions.          authorities upon their written request. If   of the offcial request, the taxpayer has
                                            the taxpayer does not have the transfer   3 months to submit its documentation,
        The content of the transfer pricing   pricing documentation fle available at   with the possibility of an extension equal
        documentation fle is required by Order   the moment when the tax authorities   to the period.
        of the President of National Agency   request it, a period of up to 3 months can
        for Fiscal Administration no. 222/2008,   be granted by the tax authorities and an   If an adjustment is proposed by the
        regarding the content of the transfer   extension may be requested for a period   tax authority, are dispute resolution
        pricing documentation fle.          equal to the one initially established.   options available to the taxpayer
                                                                                outside of competent authority?
        Failure to comply with the transfer pricing   When a transfer pricing study is
        documentation requirements is punished   prepared, should its content follow   Yes.
        with a fne that currently amounts   Chapter V of the OECD Guidelines?
        between 12,000 and 14,000 Romanian                                      If an adjustment is sustained, can
        leu (RON) (approximately 3,000 to 3,500   Yes.                          penalties be assessed? If so, what
        Euros (EUR)).                                                           rates are applied and under what
                                            Does the tax authority require an   conditions?
        If the transfer pricing documentation fle   advisor/tax practitioner to have   Beginning October 2010, the late payment
        is incomplete, the tax authorities may   specifc designation in order to   interest is 0.04 percent per day, while
        establish by their own means the arms   prepare or submit a transfer pricing   another late payment penalty (5 percent
        length prices and adjust the taxable proft   study?                     or 15 percent of the unpaid taxes
        of the taxpayer accordingly.        No.                                 depending on the period of outstanding
                                                                                debts  between 30 and 90 days or over
        Other than complying with a                                             90 days) may also be added to such
        requirement per the previous        Transfer pricing methods            upward adjustments.
        question, describe the benefts, if   Are transfer pricing methods
        any, of preparing and maintaining   outlined in Chapter II of the       To what extent are transfer pricing
        a transfer pricing study?           OECD Guidelines acceptable?         penalties enforced?
        If the taxpayer does not submit the   Yes.                              Always.
        transfer pricing documentation fle
        to the authorities within the provided   Is there a priority among the   What defenses are available with
        term, or if the fle is incomplete, the tax   acceptable methods?        respect to penalties?
        authorities may than establish by their   According to the local legislation, CUP   Comprehensive and proper transfer
        own means the arms length prices and   is the frst method to be considered.   pricing documentation.
        adjust the taxable proft of the taxpayer   However, in practice, the trend is to
        accordingly for the audited period (16   recognize the appropriateness of the
        percent tax will apply to the additional   proft-based methods.






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