HMRC’s new guidelines for compliance on transfer pricing (CfC7), published last week, suggests a more aggressive approach to tax enforcement, says LCN Legal, a firm specialising in providing intercompany
agreements for MNEs.
Paul Sutton, Partner at LCN Legal, said: ‘It is significant that the guidance stresses the requirement for contemporaneous intercompany agreements, rather than those prepared after the event. Equally, if agreements are out-of-date, so that they do not reflect the commercial reality of how a group operates, they are increasingly likely to be subject to challenge by HMRC.’
‘The IRS has also adopted a more combative stance on transfer pricing recently as we have seen in the Microsoft and Airbnb cases. This latest guidance suggests that HMRC is moving in lockstep with the US position,’ Sutton claims.
HMRC’s new guidelines for compliance on transfer pricing (CfC7), published last week, suggests a more aggressive approach to tax enforcement, says LCN Legal, a firm specialising in providing intercompany
agreements for MNEs.
Paul Sutton, Partner at LCN Legal, said: ‘It is significant that the guidance stresses the requirement for contemporaneous intercompany agreements, rather than those prepared after the event. Equally, if agreements are out-of-date, so that they do not reflect the commercial reality of how a group operates, they are increasingly likely to be subject to challenge by HMRC.’
‘The IRS has also adopted a more combative stance on transfer pricing recently as we have seen in the Microsoft and Airbnb cases. This latest guidance suggests that HMRC is moving in lockstep with the US position,’ Sutton claims.
