Global

Details

  • Service: Tax, Global Transfer Pricing Services, Global Compliance Management Services
  • Type: Regulatory update
  • Date: 2/5/2013

Denmark - 2012 statistics of transfer pricing audits, MAPs, APAs 

February 5: The Danish tax authorities (SKAT) have published the 2012 statistics concerning transfer pricing audits, mutual agreement procedures (MAPs), and advance pricing agreements (APAs).

In general, the 2012 statistics reveal a trend of substantially increased transfer pricing activity by the tax authorities.

Transfer pricing audits

According to SKAT statistics for 2012, transfer pricing adjustments more than tripled in 2012, when compared to 2011. The increased level of adjustments is viewed as indicating a more aggressive position of the tax authorities concerning transfer pricing issues.


The aggregated transfer pricing adjustment amount for 2012 also set a new record for SKAT—adjustments for 2012 were DKK 21.2 billion (approximately U.S. $3.85 billion).

Table 1: Number of transfer pricing audits with upward adjustments

Tax year Number of transfer pricing audits Adjustments (DKK in billions)
2012 67 21.2
2011 47 6.1
2010 40 6.2
2009 32 15.2
2008 27 8.7

A large number of the 2012 transfer pricing audits—16 out of 67—related to audits of transfers of intangibles and remuneration relating to intellectual property (IP) rights. The adjustments relating to IP were DKK 13.1 billion—equivalent to more than 60% of the adjustment level.


In comparison, the downward adjustments in 2012 are viewed by tax professionals as being insignificant (approximately U.S. $64 million).

Table 2: Number of transfer pricing audits with downward adjustments

Tax year Number of audits Adjustment (DKK in millions)
2012 18 351.3
2011 24 780.8
2010 18 547.1

MAPs, APAs

The SKAT has a well-established program for MAPs and APAs, aligned with the network of double taxation agreements.


The SKAT efforts in 2012 resulted in closing 13 MAP cases being closed, and 76 MAP applications pending.

Table 3: MAPs pending, settled

Tax year MAPs pending MAPs settled
2012 76 13
2011 53 18
2010 36 27
2009 52 7
2008 36 16

During the same period, the tax authorities signed two bilateral APAs, whereas 13 APAs were under preparation for negotiations with other countries’ competent authorities.

Table 4: APAs pending, settled

Tax year APAs pending APAs settled
2012 13 2
2011 9 4
2010 8 7
2009 12 3
2008 12 1

KPMG observation

Tax professionals with KPMG’s Global Transfer Pricing Services practice in Denmark have considered the 2012 statistics in light of their experience with respect to transfer pricing audits and in resolving double taxation issues via APAs and other dispute resolution methods.



Contact a tax professional with KPMG's Global Transfer Pricing Services.




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