OECD Transfer Pricing Guidelines are optional for fiscal year 2023 and mandatory for 2004
São Paulo, July 10, 2023
The Brazilian Transfer Pricing draft regulation that regulates Law No. 14.596/2023 (RFB Public Consultation No. 01/2023) establishes that the new Transfer Pricing rules in Brazil, which follow the Guidelines on the subject that has published by the OECD, they will be mandatory for taxpayers with respect to fiscal year 2024 and optional with respect to 2023. This means that with respect to 2023 companies can decide whether to apply the new Transfer Pricing rules or continue to apply the old ones.
If they opt for the new rules, they have until November of this year (Title V of the draft regulation – Early Application Option for 2023) to inform the Tax Administration of this decision through the opening of a digital process through the Portal of the Virtual Service Center (Portal e-CAC) or through the annex of the option term contained in Annex II of the draft regulation.
Now, what should Brazilian companies that have this option do? As the issue of Transfer Pricing is eminently technical, what should be done is a professional analysis so that companies know, with respect to fiscal year 2023, the consequences of applying the current or new regime. Based on this analysis, companies can make the best decision for their organization.
If you have questions about how to do this analysis, contact us at dmarchant@tpconsulting.com.
We are at your disposal to help you in this important decision.
