Legal and Finance: Transfer Pricing Deadline
Midland companies have just three months to comply with changes to transfer pricing regulations announced by the Chancellor recently.
The existing transfer pricing rules, in place since 1999, broadly require cross-border transactions between related parties to be carried out on an 'arm's length' basis for tax purposes, and for those prices to be supported by documentary evidence.
The changes, which take effect from April 1, extend this burden to UK-UK arrangements bringing more deals and local companies within the scope of the rules.
Julia Sceats, from KPMG's transfer pricing group in Birmingham, said: 'The changes are likely to have the greatest impact on UK groups that have previously not had to consider transfer pricing when submitting their tax returns.
'They have just four months to comply with a regime they have no previous experience with -that is likely to mean a lot of work in a short time.
'Multinational groups will already be familiar with the burden of the transfer pricing rules, having operated under the existing regime for cross-border transactions, since 1999. …