Belgium

Transfer Pricing 

Multinationals increasingly see national borders as irrelevant to how they conduct daily business. This is not the case for tax authorities, which are increasingly aware of how transfer prices may affect tax revenues. Strengthened legislations, stricter documentation requirements and penalties for non-compliance are regularly imposed. Transfer pricing is a critical issue for all companies with cross border, inter-company transactions, and is one of the cornerstones of effective global tax planning.

KPMG’s multidisciplinary approach can help you manage your company’s transfer pricing issues by providing advice on planning, compliance and documentation, dispute resolution solutions, and practical implementation of your transfer pricing policy. We also have significant experience in responding and challenging the issues raised by tax authorities during audits. Our strategies are directed to be commercially viable and balanced, generating tax efficiencies and mitigating the risk of tax authority challenge.
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Global TP Review

Transfer pricing is at the core of international trade within multinationals. Thus it is important to stay current with transfer pricing rules worldwide. The Global Transfer Pricing Review provides a wealth of local country transfer pricing information, including documentation requirements, deadlines, transfer pricing methods, penalties, special considerations, advance pricing arrangements, and competent authority matters.


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Regulations

This section provides a general overview of the transfer pricing regulations that should be taken into account from a Belgian and OECD perspective when determining an arm’s-length remuneration for the provision of intercompany services, tangible or intangible goods, and financial transactions between related companies of a multinational enterprise.


Recent BEPS Actions

With the increasing globalization and complexity of intercompany flows, the national laws have not kept pace with their changing tax environment. Indeed, the fluid capital and the growing importance of digital economy create new opportunities for multinational enterprises to avoid taxation in their domestic countries by shifting their activities and (intangible) assets to low or no tax jurisdictions, undermining the fairness and integrity of tax law provisions.


By launching its Base Erosion and Profit Shifting (“BEPS”) action plan in July 2013, the OECD is looking to tackle those issues. The action plan consists of 15 specific actions providing international guidance to address BEPS. The main objectives of the action plan is to develop a new set of standards namely to prevent double non-taxation, to ensure the consistency of the international tax system and tax transparency.


Access the OECD BEPS webpage for more information and a download of the deliverables.


September 2014

  • Action 1 – Digital economy
  • Action 2 – Hybrid mismatch arrangements
  • Action 5 – Harmful tax practices (Phase 1)
  • Action 6 – Tax treaties abuse
  • Action 8 – Intangible assets (Phase 1)
  • Action 13 – Transfer pricing documentation requirements
  • Action 15 – Multilateral instrument (Phase 1


September 2015

  • Action 3 – Controlled Foreign Companies (“CFC”) rules
  • Action 4 – Financial payments (Phase 1)
  • Action 5 – Harmful tax practices (Phase 2)
  • Action 7 – Permanent establishment
  • Action 8 – Intangible assets (Phase 2)
  • Action 9 – Transfer pricing and risk & capital
  • Action 10 – Transfer pricing and other high-risk transactions
  • Action 11 – Data collection and methodologies
  • Action 12 – Tax planning arrangements
  • Action 14 – Dispute resolution mechanisms


December 2015

  • Action 4 – Financial payments (Phase 2)
  • Action 5 – Harmful tax practices (Phase 3)
  • Action 15 – Multilateral instrument (Phase 2)


On 16 September 2014, the OECD released its first set of recommendations under seven topics of the BEPS project.

Although the proposed measures were already approved by the OECD members, OECD accession as well as G20 member countries, those deliverables are still draft reports. Indeed, given the interaction between all actions and the comprehensive and holistic approach of OECD to tackle BEPS issues, all reports will be finalized in December 2015 to take into account the effect of the measures taken in the upcoming deliverables.

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Dirk Van Stappen

Dirk Van Stappen

Partner

+32 (0)38211918