Details

  • Type: Regulatory update
  • Date: 6/5/2014

Issuance of Ministerial Decision POL.1144/15.5.2014 regarding the contents of the Transfer Pricing Documentation File and other related issues for tax years commencing 1 January 2014 

Ministerial Decision POL. 1144/15.5.2014 was recently issued amending POL. 1097/9.4.2014, regarding the content of the Transfer Pricing Documentation File and other related issues for tax years commencing from 1 January 2014 onwards

In addition to requirements for further detailed information to be included in the Documentation File (whilst still awaiting further clarifications from the Ministry in relation to the completion of the Summary Information Sheet), the main amendments introduced are the following:


  • Regarding the update of the Basic and the Greek Documentation File, if the taxpayer can demonstrate that its operating conditions have not changed, then the comparable data derived from databases may be used for up to three tax years, provided that such financial data are updated for every year.


  • The definition of an “incomplete” or “inadequate” Documentation File is introduced. This is a File that has not been prepared according to the provisions of POL. 1144/15.5.2014, or information is missing from the Documentation File, or if the Documentation File includes inaccurate information which makes audit verifications impossible even after the provision of supplementary information.


  • The definition of “inaccurate” and “incomplete” Summary Information Sheet is introduced. This is a Summary Information Sheet that contains information that is not consistent with the information included in the Documentation File or there is inaccurate and incomplete reporting of the data required according to POL. 1097/9.4.2014.



It is noted that:


  • for the tax years commencing from 1 January 2014 onwards, a penalty is imposed in the case of submission of an inaccurate or incomplete Summary Information Sheet as well as in the case of an incomplete or inadequate Documentation File and


  • the penalty for an inaccurate/incomplete Summary Information Sheet (which is calculated at the rate of 1% of the taxpayer’s recorded gross profits and which cannot be less than EUR 10 000 or greater than EUR 100 000) is stricter than the penalty for the incomplete/inadequate Documentation File (which is calculated at the rate of 0.1% of the taxpayer’s recorded gross profits and which cannot be less than EUR 1 000 or greater than EUR 10 000).



Therefore, it is imperative that the Ministry of Finance issues clear guidance for the completion of the Summary Information Sheet. In addition, it becomes critical to finalize the Documentation File in time, before the submission of the Summary Information Sheet (i.e. prior to the deadline of the four month period commencing from the end of the tax year), in order to ensure that the information included in the Documentation File is appropriately recorded in the Summary Information Sheet (e.g. the amounts of the intercompany transactions, the categorization of intercompany transactions, the methodology of documentation, etc.) so as to avoid the application of the penalties.


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