Latest Expert Exchange Queries

GST Demo Service software link:
Username: demouser Password: demopass
Get your inventory and invoicing software GST Ready from Binarysoft
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing | GST - Goods and Services Tax
Popular Search: list of goods taxed at 4% :: VAT Audit :: empanelment :: TAX RATES - GOODS TAXABLE @ 4% :: TDS :: cpt :: ACCOUNTING STANDARD :: ARTICLES ON INPUT TAX CREDIT IN VAT :: VAT RATES :: ACCOUNTING STANDARDS :: form 3cd :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: due date for vat payment :: articles on VAT and GST in India :: Central Excise rule to resale the machines to a new company
« Transfer Pricing »
  CBDT notifies secondary adjustment transfer pricing rules
  A web of requirements in transfer pricing regime
 Hong Kong bill would revise multinational firm tax and transfer pricing rules
 India signs Advance Pricing Agreements with the Netherlands
 India eases bilateral transfer pricing norms
 India to accept transfer pricing APA, MAP applications even if corresponding adjustment treaty provision absent
 India Finalizes Pricing Reporting Rules Under OECD Plan
 Final Transfer Pricing Rules For Multi-Nationals Notified
 Govt eases transfer pricing norms for offshore funds
 India’s final transfer pricing master file rules retain unique flavor
 Transfer pricing: tighter reporting norms for multinationals notified

Declaration Now Required on Transfer Pricing Documentation in Malaysia
August, 11th 2014

In early July, the Malaysian Internal Revenue Board (“IRB”) published the 2014 tax return form that Malaysian corporate taxpayers must submit for Year of Assessment 2014. Notably, the form includes a small addition which requires taxpayers to declare whether they have prepared transfer pricing documentation. Simply put, taxpayers indicate in Section R either “Yes” or “No” as regarding the existence of transfer pricing documentation.

This is a very significant development from a transfer pricing perspective.

In the detailed notes accompanying the tax return, it is made explicitly clear by the IRB that transfer pricing documentation refers to contemporaneous transfer pricing documentation for the current year in question. The definition of “contemporaneous” is based on the revised Transfer Pricing Guidelines issued in 2012 as well as the Income Tax (Transfer Pricing) Rules 2012.

In general, contemporaneous transfer pricing documentation refers to documentation in support of the pricing of related party transactions that occurred during the course of the financial year, and is typically prepared before the tax return for that year is filed. Such documentation, at the very least, should outline the nature of the transactions, a description of how prices were set between the related parties and a description of how this pricing policy was evaluated to be at arm’s length. Although this documentation does not have to be provided to the IRB when the tax returns are filed, it must nonetheless be in existence.

RELATED: Malaysia Announces Transfer Pricing Awareness Survey

By indicating “Yes,” taxpayers are declaring that they are in possession of transfer pricing documentation. Although in general, such documentation must be provided to the IRB within 30 days of filing, we have seen cases where taxpayers are expected to provide the transfer pricing documentation to the IRB within 14 or even 7 days. One way in which tax authorities can verify the existence of “contemporaneous” transfer pricing documentation is to check the date on which the document was created and finalized either internally / externally (by the transfer pricing consultant).

Needless to say, stating “No” would definitely be a red flag for the taxpayer as it would be an open admission that the company has not complied with the relevant transfer pricing provisions of the Malaysian Income Tax Act. It should be noted that the need for contemporaneous transfer pricing documentation has existed in Malaysia since 1 January 2009. In addition, the IRB has also introduced a penalty regime for the failure to maintain contemporaneous annual transfer pricing documentation.

In conclusion, Malaysian taxpayers that have related party transactions are strongly advised to prepare transfer pricing documentation in support of the arm’s length nature of these transactions. Failure to maintain annual, timely transfer pricing documentation can result in audit scrutiny and financial penalties.

Sowmya Varadharajan, is a founding director of IC Advisors Pte Ltd, a transfer pricing consulting firm. Sowmya has more than 12 years of experience assisting clients in designing, supporting and defending various related party transaction structures. Having been trained in the U.S., Sowmya currently focuses her attention on helping clients in the Asia Pacific region address their transfer pricing issues.

Asia Briefing Ltd. is a subsidiary of Dezan Shira & Associates. Dezan Shira is a specialist foreign direct investment practice, providing corporate establishment, business advisory, tax advisory and compliance, accounting, payroll, due diligence and financial review services to multinationals investing in China, Hong Kong, India, Vietnam, Singapore and the rest of ASEAN. For further information,

Home | About Us | Terms and Conditions | Contact Us
Copyright 2018 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Bath SEO Company Birmingham SEO Company Bradford SEO Company Brighton and Hove SEO Company Bristol SEO Company Cambridge SEO Company Canterbury SEO Company Carlisle SEO Company Chester SEO Company Chichester SEO Company Coventry SEO Compan

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions