OECD Releases COVID-Based BEPS Report
The OECD has released new guidance for multinational groups and tax agencies on the impact of the COVID-19 pandemic on transfer pricing compliance matters.
The new report, titled ‘Guidance on the Transfer Pricing Implications of the COVID-19 Pandemic’, is intended to address practical questions relating to transfer pricing and is part of the BEPS Inclusive Framework’s commitment to improving tax certainty.
The OECD explained that the guidance is intended to aid both taxpayers in reporting the financial periods affected by the pandemic and tax administrations in evaluating the implementation of taxpayers’ transfer pricing policies. The Guidance provides clarifying comment on, and illustrations of, the practical application of the arm’s length principle in four priority issues, identified in consultation with Business at the OECD (BIAC): comparability analysis; losses and the allocation of COVID-19 specific costs; government assistance programs; and advance pricing agreements.
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