В Украине на законодательном уровне происходят изменения в регулировании системы трансфертного ценообразования. Так, к контролируемым сделкам относятся сделки, влияющие на объект налогообложения, сделки купли-продажи с участием нерезидентов, сделки с дочерними нерезидентами при участии независимых посредников, однако с 1 января 2015 года в данный список не входят сделки, совершаемые между резидентами Украины. Также внедрены новые правила предоставления отчетности и документации по контролируемым сделкам, в соответствии с новой редакцией Налогового кодекса Украины. В Налоговом кодексе определены пять основных способов ценообразования. Также в нынешнем году были изменены приоритеты официальных источников информации, необходимых для аудита контролируемых сделок и анализа налога при трансфертном ценообразовании. Кроме того, значительно возросла сумма штрафа за непредоставление отчетности. Трансфертное ценообразование требует тщательного анализа, направленного на своевременное устранение налоговых рисков в деятельности компании. Как показывает опыт в трансфертном ценообразовании за последние годы, наиболее эффективным решением было бы привлечение иностранного эксперта для контроля внутренних цен, процесса предъявления отчетов и урегулирования других вопросов трансфертного ценообразования.
Настоящая статья привлекает повышенный интерес своей актуальностью.
The current system of transfer pricing regulation in Ukraine is still being improved. The latest amendments to tax legislation introduced by the Act of 15 July 2015, No. 609-VIII that came into effect on 13 August 2015. Generally, with the help of the abovementioned Act several tasks have been completed. Namely, the drawbacks of the previous wording of Article 39 of the Tax Code of Ukraine are eliminated (for example, financial ratios list needed for the profitability calculation is brought back), and the new wording of some basic norms, including those regulating the definition of the controlled transactions, is presented. All amendments can be defined as quite liberal toward taxpayers. Although some fiscal details such as tripling of the penalty for the failure to submit reports are not avoided.
So, let us consider the basic regulatory norms taking into account the new rules.
Transactions defined as controlled transactions in 2015
1. Transactions having impact on the object of taxation by means of the taxpayer’s profit tax:
— with affiliated non-resident parties;
— with affiliated resident parties of the states found on the List of 14 May 2015, No.449-p approved by the Cabinet of Ministers of Ukraine (CMU) (the states where the corporate profit tax rate is less than the Ukrainian rate by 5% which have no agreements signed with Ukraine containing information exchange provisions);
2. Foreign trade transactions on selling goods through non-resident agents;
3. Transactions with affiliated non-resident parties through independent mediators which do not fulfill any essential functions or bear any serious risk, or use assets while being involved in the transactions carried out.
All the above-mentioned transactions are treated as controlled transactions, provided achievement of the cost criterion containing the following two conditions:
— the taxpayer’s annual income from all types of activities determined by accounting rules exceeds UAH 50 million (after indirect taxes);
— the volume of the taxpayer’s transactions with one counterparty exceeds UAH 5 million (after indirect taxes) in the reporting period.
It is worth mentioning that from 1 January 2015 the transactions between residents of Ukraine are excluded from the list of controlled transactions. The ambiguity of wording concerning defining the transactions between affiliated parties through independent mediators as controlled transactions is eliminated. Now a transaction with an affiliated non-resident party is clearly defined as the basic one.
It is also important to note that the size of the taxpayer’s annual income for the cost criterion checking purpose is now determined in accordance with accounting rules. It seems to be quite logical with consideration for the new wording of Chapter III of the Tax Code of Ukraine and measures taken to approximate tax accounting and accounting. Besides, according to the new rules, not only VAT but excise tax too is to be deducted when calculating the size of the taxpayer’s general annual income and the volume of the taxpayer’s transactions with each counterparty.
Reporting and documentation
The reporting period is a calendar year. The report on controlled transactions is to be submitted by 1 May of the year following the reporting year.
The documentation on controlled transactions is a document following no particular form but which obligatorily contains detailed information on the parties to the agreement or specific transaction as well as economic factors that influenced the price determined in the agreement. The documentation is submitted upon request of the regulatory authority within a period of one month. It is also important to note that from 1 January 2015 a taxpayer is fully responsible for the preparation and storage of the documentation on controlled transactions.
The report and documentation on controlled transactions performed in 2015 are prepared according to the new rules. The documentation for 2013-2014 is prepared according to the requirements of Article 39 of the Tax Code of Ukraine as in force before 1 January 2015.
The methods to determine whether the controlled transaction price corresponds to the arm’s length principle
The Tax Code of Ukraine offers five basic pricing methods to determine the price level. The most reasonable method for each type of transactions is chosen depending on reliable information, if any, on comparable transactions, results of the transactions’ functional analysis, degree of comparability and possibility for adjustment of conditions.
1. Comparable uncontrolled price method
This method is the primary method to be used over all others. It involves comparing the controlled transaction price to the comparable transaction price. Using this method the most accurate result can be obtained, not forgetting its peculiarities, which are strict requirements to the goods (works, services) characteristics comparability. It is most successfully applied to goods in which there is an active market.
2. Resale price method
This method can be used by the buyer in the transaction. It involves comparing the controlled transaction resale price margin to the comparable transaction margin. In order to apply this method it is rather complicated to find external comparable transactions, as competitive information is not publically available, and in plain English, it is suppressed. However, it is quite possible to use this method for one’s own comparable transactions. And it is fundamentally reasonable for it to be applied by distributors.
3. Cost-plus method
This method involves comparing the supplier’s cost gross profit margin in the controlled transaction to the cost profit margin in the comparable transactions. This method can be frequently applied by manufacturers of goods (service providers).
4. Net margin method
Using this method the transaction net profit and an appropriate base (total sum of sales, expenses, assets) ratio is calculated. The choice of base for the calculation depends on the degree of ratio impact on the transaction result. For example, it is reasonable to calculate the return on assets for asset-intensive production.
5. Profit split method
This method implies analysis of the transaction total profit splitting according to the materiality of each party’s contribution. The contribution weight determines the party’s size of remuneration.
In 2015 the five basic pricing methods application procedure has not been significantly amended, whereas the method of determining price in the listed goods’ import/export transactions has undergone changes.
Currently, the price in such transactions is determined not according to the rules providing for the 5% stock exchange quotation corridor, but by applying the comparable uncontrolled price method. For this purpose the price range calculated according to the procedure approved by the Cabinet of Ministers of Ukraine is grounded on using stock exchange quotations of certain goods for the decade predating the transaction. The list of stock exchange goods and the world stock exchange quotations permitted for use should be set by the CMU. As present time these regulatory documents are absent, which makes the taxpayer’s work more difficult.
Sources of information on comparable transactions for further analysis
Any publicly-accessible information sources as well as own uncontrolled with non-affiliated parties of the taxpayer or the counterparty can serve as sources of information.
From 1 January 2015 the priority of official sources of information is countermanded.
Transfer pricing tax control
The basic ways of exercising control over transfer pricing are:
— monitoring and analysis of reporting and documentation as well as other sources of information concerning prices;
— special audits for taxpayers.
The cases in which the audit of controlled transactions is conducted are changed. Their number is reduced to three due to exclusion of controversial norms, such as, in particular, the one provided that even the submission of the report on the controlled transactions can serve as a case for an audit to be conducted. Currently, the audit can be conducted in the following cases:
— when a notification on unreported controlled transactions has been provided by the regulatory body;
— when monitoring of transactions has revealed non-compliance of the controlled transactions terms with the arm’s length principle;
— when the taxpayer has failed to submit (or has submitted it with violations) the report or documentation.
The penalty regime:
— 300 minimum wages for failing to submit the report (in a timely fashion as well);
— 1% of the volume of the controlled transactions not mentioned in the report, capped at 300 minimum wages;
— 3% of the volume of the controlled transactions for failure to submit the documentation on them (capped at 200 minimum wages).
The penalty for failure to submit the report has been considerably increased to UAH 365,400, as previously the penalty for this violation amounted to 100 minimum wages, which is UAH 121,800 correspondingly. At the same time, the penalty for the transactions undeclared is reduced to 1% of the volume of such transactions, though previously it amounted to 5% unlimited.
In general, in spite of some changes introduced to the norms regulating transfer pricing, they can hardly be called global changes and for many taxpayers transfer pricing legislation remains extremely complicated. This situation is caused not only by problems dealing with the practical application of the norms and lack of experience, but also with the absence of properly qualified experts in companies. And transfer pricing is not only about economic factors that influence the determination of the contract price, but it requires thorough analysis of the company’s activities on the whole. Such analysis aims to eliminate tax risks in a timely fashion. Within the analysis it is necessary to study a lot of components, such as ownership, major business processes, economic relations, assets splitting within the group of companies, sharing of functions and risks. The analytical results obtained will enable the business model to be corrected, which often means changing the structure/chain of the contracting relations or influencing the mechanism of price determination and following substantiation.
Thus, the primary goal for taxpayers is to eliminate tax risks and to demonstrate that the company follows the market pricing principle.
We recommend the following measures to be taken in order to avoid transfer pricing risk:
— Critical assessment of the economic activity model;
— Developing the basic procedures for the price level control;
— Establishment a competence centre or sharing of responsibilities within the company;
— Approval of internal TP Regulations (Policy);
— Clear price determination policy;
— Permanent monitoring of the level of contracting prices;
— Software improvement;
— Timely preparation of the documentation package.
Undoubtedly, it is not all a bed of roses, and for the time being there are problems which are well known to us as actively practicing experts. And the major concern is the lack of open and accessible sources of information on comparable transactions.
In 2013-2014 the priority and preferential use of official sources of information was legislated. However, these sources contain data on a limited amount of goods and there was no information at all on works and services. In this situation the taxpayer’s own transactions with non-affiliated counterparties can be considered as the only real and accessible source. More often than not when preparing documentation on controlled transactions the taxpayer’s comparable transactions with non-affiliated counterparties appear to be the only possibility to confirm the price level. That’s why we always draw the attention of our clients to their own transactions.
To my mind, another problem deals with the companies lacking internal experts who would exercise control over transfer pricing performing all necessary procedures in a timely fashion. As a rule, we observe documentation to be prepared (either independently or with the help of an outside expert) after the report’s submission, which means that the price level is checked with a significant delay, and in case when it is impossible to confirm the price the taxpayer has to either correct and file an amended report or wait until the tax authorities charge additional taxes within the audit conducted. For example, the report to be submitted by 1 May should contain the pricing method, source of information on comparable transactions and the price that corresponds to the market price range, which means that economic analysis of transactions should be carried out. But the rule of thumb states that more often than not the taxpayer prepares the report on such information guided by intuition, and then within the economic analysis it appears to be impossible to confirm the price with the method stated in the report.
Our experience in transfer pricing during the last year revealed that involvement of an external expert to exercise control over compliance of transfer pricing norms appears to be an effective solution for many companies. Establishment of a special internal department is costly for many companies taking into account additional expenses for experts’ training and related costs. That’s why many client companies see the solution to the problem specifically in the involvement of specially trained external experts. Under contractual relations the external expert helps, as a rule, to provide internal price monitoring, prepares or reviews the report on the controlled transactions before its submission and prepares the full documentation package stating the economic factors that influence price determination. They also deal with the regulatory authority on any issues concerning transfer pricing and secure the audit. This enables the heads of the accounting and financial services to stick to their routine work given that they have plenty of it.
1 See http://www.me.gov.ua/?lang=uk-UA.
2 See On Amendments the Tax Code of Ukraine due to the Tax Reform Act of Ukraine No. 71-VIII, dated 28.12.2014.
Автор: Larysa V. Vrublevska
Источник: http://www.ujbl.info/article.php?id=662