1 TRANSFER PRICING ANKARA, 07 March 2012 Ayben ÜNEL OVERVIEW OF THE TP REGULATIONS IN TURKEY.
13
1 TRANSFER PRICING ANKARA, 07 March 2012 Ayben ÜNEL OVERVIEW OF THE TP REGULATIONS IN TURKEY
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Transcript of 1 TRANSFER PRICING ANKARA, 07 March 2012 Ayben ÜNEL OVERVIEW OF THE TP REGULATIONS IN TURKEY.
1
TRANSFER PRICING
ANKARA, 07 March 2012 Ayben ÜNEL
OVERVIEW OF THE TP REGULATIONS
IN TURKEY
2
Turkish Regulations (with respect to OECD Guidelines)
January 2007
November 2007
December 2007
April 2008
April 2008
November 2010
April 2008
Article 13 of the CITL No. 5520
General Communiqué No.1
Cabinet Decision
General Communiqué No.2
Cabinet Decision
Circular
TP Guidelines
3
scope of taxpayers comprehensive definition of related parties definition of arm’s-length principle comparability analysis definition of arm’s-length range methodologies APA documentation requirements penalties adjustments intangibles intra group services
Contents
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Scope : all resident and non-resident corporate taxpayers all resident and non-resident individual taxpayers both domestic and cross-border transactions
Conditions for determination of disguised income profit via transfer pricing: purchase or sale of a good or service made with related parties contrary to ALP
Scope & Applicability
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Sale or purchase of goods and services include : purchases sales manufacturing and construction leasing and renting borrowing and lending distribution of bonus, salary, or similar items
Definition of Scope of Transactions
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The following ones can be given as an example :
shareholders of the corporation individuals or legal entities related to the corporation or its shareholders individuals or legal entities which control the corporation directly or
indirectly in terms of management, supervision or capital individuals or legal entities which are controlled by the corporation
directly or indirectly in terms of management, supervision or capital other relatives (including third-degree)
Definition of Related Parties - Article 13(2)
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in determining arm’s length price
comparability analysisI. characteristics of goods or services;II. functional analysisIII. economic conditionsIV. business strategies * When comparing the items, “contractual terms” should be taken
into account as well
Arm’s Length Principle - Article 13(3)
internal comparable
external comparable
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CUP C+ RPM Other methods
a) PSM b) TNMM c) Method determined by the taxpayer
Transfer Pricing Methods
profit-based methods
- Article 13(4)
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3 types of documentation requirements : Annual Transfer Pricing Report Transfer Pricing, CFC and Thin Capitalisation Form Annual APA Report
Deadline to prepare documentation : TP documentation report and supporting documents must be prepared and available
when the corporate income tax return is submitted following the end of the fiscal
Deadline to submit documentation : submission of the TP documentation is required on request
Documentation Requirements
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corporate taxpayers applicable for up to 3 years types of APAs
unilateral ( first APA was signed in July,2011) bilateral multilateral
renewing / revising / revoking annual APA report application fees (for the year 2012)
38.147,30 Turkish Lira (app. 16.580 €) for each new APA 30.517,75 Turkish Lira (app. 13.260 €) for each renewal.
Advance Pricing Agreements - 1
non-refundable
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Advance Pricing Agreements - 2
APA Application Process Written Application
Pre-review of application
Additional informationand/or
Interview with the taxpayer
Analysis
Signing of a formal APA(max. 3 years)
(If it is needed)
Rejection
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no specific TP penalties, general rules regulating tax penalties under Tax
Procedure Law No. 213 will be applied.
Penalties
if transfer prices are not
arm’s length
if documentation requirements
are not fulfilled
