Eight Forum on Tax Administration (FTA) members start a multilateral TP and PE tax risk assurance programme

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Source: OECD announcement 23 January 2018

A pilot of a new FTA programme for the multilateral risk assessment of large MNE groups was launched at a Washington DC event on 23 January 2018.

The International Compliance Assurance Programme (ICAP) is a pilot for a voluntary programme that will use CbC Reports and other information to facilitate multilateral engagements between MNE groups and tax administrations, with a view to providing early tax certainty and assurance.

By co-ordinating conversations between an MNE group and tax administrations in several jurisdictions, the programme aims to ensure:

  • a more effective use of transfer pricing information (including that contained in a group’s CbC report, master file and local file),
  • a more efficient use of resources for MNE groups and for tax administrations and
  • fewer cases entering into mutual agreement proceedings (MAP).

The ICAP pilot involves Australia, Canada, Italy, Japan, the Netherlands, Spain, the UK and the US. It will look at the transfer pricing and permanent establishment tax risks posed by each of the MNE groups involved, commencing during the first half of 2018 with completion expected within a target timeframe of 12 months.

A handbook which provides more detail on ICAP and the procedure for the pilot was also launched at the event.

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