The UK To Reject EU CCCTB Plans

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Britain will reject plans announced in Brussels this week to combat tax avoidance by the world’s biggest MNEs says David Gauke, the Treasury minister responsible for tax policy. Read the rest of this entry »

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Hard to Value Intangibles (HTVI) – BEPS Action 8

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The OECD has released a discussion draft on arm’s length pricing of intangibles when valuation is highly uncertain at the time of the transaction, with special consideration of hard to value intangibles (HTVI).

When the valuation of an intangible at the time of the transaction is highly uncertain, the draft suggests that the question should be resolved by reference to what independent enterprises would have done in comparable circumstances to take account of the valuation uncertainty in the pricing of the transaction. Read the rest of this entry »

Transfer Pricing Methods

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See my previous notes in this category for discussions of the arm’s length principle, the tested party, comparables and comparability analyses.

The OECD Guidelines describe three traditional transaction methods and two transactional profit methods for calculating a transfer price. Although no absolute hierarchy now exists within the Guidelines, the OECD states that where the comparable uncontrolled price (‘CUP’) and another pricing method can be applied in an equally reliable way, the CUP method is preferable. Read the rest of this entry »

Minimising Transfer Pricing Risk

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Given the need for countries to protect their tax base in the current economic climate, a continuing aggressive stance by tax authorities to Transfer Pricing can be expected.

So, what actions can a Multi-National Enterprise (MNE) take to minimise its Transfer Pricing risk?

Well, it’s essential to have a Transfer Pricing policy, supported by relevant and appropriate documentary evidence to demonstrate that the outcome is arm’s length. Read the rest of this entry »

Permanent Establishment

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Many non-EU companies seeking to expand into Europe will start with a presence in the UK due to language and cultural connections, the UK’s legal framework and access to capital markets.

What are the potential UK tax implications from such a presence? Read the rest of this entry »