The role of commercial purpose in arm’s length rules is reconsidered by the CJEU, and appears more generous to taxpayers, writes Kelly Stricklin-Coutinho (39 Essex Chambers).
The significance of Hornbach-Baumarkt (Case C-382/16) is that the CJEU has looked again at the arm’s length principle and commercial purpose as a matter of EU law and the conclusion it reaches may be more generous towards taxpayers than the interpretation given to the case law by the English courts. On a fundamental issue where the arm’s length principle is relevant; it considers the relevance of the characteristics of the taxpayer in assessing commerciality.
This case may therefore present an opportunity for taxpayers to consider whether this broader principle applies to them and whether their arrangements align with it.
The case
The case was a reference for a preliminary ruling on the compatibility of the German transfer pricing...
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The role of commercial purpose in arm’s length rules is reconsidered by the CJEU, and appears more generous to taxpayers, writes Kelly Stricklin-Coutinho (39 Essex Chambers).
The significance of Hornbach-Baumarkt (Case C-382/16) is that the CJEU has looked again at the arm’s length principle and commercial purpose as a matter of EU law and the conclusion it reaches may be more generous towards taxpayers than the interpretation given to the case law by the English courts. On a fundamental issue where the arm’s length principle is relevant; it considers the relevance of the characteristics of the taxpayer in assessing commerciality.
This case may therefore present an opportunity for taxpayers to consider whether this broader principle applies to them and whether their arrangements align with it.
The case
The case was a reference for a preliminary ruling on the compatibility of the German transfer pricing...
If you or your firm subscribes to Taxjournal.com, please click the login box below:
If you do not subscribe but are a registered user, please enter your details in the following boxes:
