Tax Flash - 09/03/2021 Tax Flash - 09/03/2021 Tax Flash - 09/03/2021

Transfer Pricing Declaration

Objective

To ensure that the taxpayers report related party transactions while filing the income tax return and identify the method/basis on which compliance with the arm’s length principle can be determined.

Threshold

Total revenue or total assets exceeding QAR 10 million

Due Date

4 months from the fiscal year end (same as income tax return)

Other remarks

Not limited to cross-border transactions (i.e., applicable for domestic transactions as well)

High level overview of the contents of the document

General information about the group including:

• Description of the group's activity, and changes if any
• A list of the major intangible assets
• Description of the group's transfer pricing policy

Specific information about the reporting entity including:

• Statement of related party transactions exceeding QAR 200,000
• Transfer pricing methods

Master File

Objective

To provide an overview of the company’s group business operations and explain company’s TP policies in the context of its global economic, legal, financial and tax profile

Threshold

Total revenue or total assets exceeding QAR 50 million and having a related party transaction outside Qatar

Due Date

6 months from the fiscal year end

Other remarks

Cross-border transactions are a pre-requisite for applicability of Master File requirements

High level overview of the contents of the document

Description of the business including:

• Important drivers of business profit
• Description of the supply chain (for 5 largest plus those that represent more than 5% of turnover)
• Important intra-group services
• Description of the main geographies
• Functional analysis describing principal contributions
• Organization structure and important business restructurings

Intangibles including:

• The company’s overall strategy for the development of intangibles
• A list of important intangibles
• Inter-group agreements relating to intangibles
• TP policies related to research and development and intangibles
• Important transfers of intangibles

Intra-group financial activity including:

• How the company is financed
• Identification of central financing companies
• TP polices relating to financing

Financial and tax positions including:

• Consolidated financial statement
• Information on tax rulings relating to the allocation of income

Local File

Objective

To ensure that the taxpayer has complied with the arm’s length principle in its material TP positions affecting a specific jurisdiction

Threshold

Total revenue or total assets exceeding QAR 50 million and having a related party transaction outside Qatar

Due Date

6 months from the fiscal year end

Other remarks

Cross-border transactions are a pre-requisite for applicability of Local file requirements

High level overview of the contents of the document

Information about the company including:

• The management structure of the company and organisation chart
• A detailed description of the business and business strategies
• Key competitors

Description of the controlled transactions including:

• Description of material controlled and context of such transactions
• The amount of intra-group payments and receipts for each category of controlled transactions per jurisdiction of foreign related party
• Copies of main agreements entered into
• Detailed transaction-wise analyses: Functional analysis, identification and reason of selection of related party, selection of most appropriate method
• A list and description of selected comparable uncontrolled transactions and financial indicators thereof

Financial information including:

• The company’s annual financial accounts for the fiscal year concerned (audited statements)
• Reconciliation of data used for TP analysis with audited financials
• Summary schedules of financial data used for comparable transactions along with their sources