The UAE Federal Tax Authority ('FTA’) has been gradually introducing guides and publications to the various aspects covered in the UAE Corporate Tax Law (‘CT Law’). In the most recent publication dated 23 October 2023, the FTA issued an extensive c. 140-page Transfer Pricing Guide (the ‘UAE TP Guide’).
The UAE TP Guide offers insights and illustrative examples on various aspects of the UAE Transfer Pricing (‘TP’) regime, such as the application of the arm’s length principle, Transfer Pricing Documentation, considerations for specific transactions like financial transactions, intra-group services, intangibles and cost contribution arrangements, as well as Transfer Pricing audits and risk assessments. The UAE TP Guide takes into consideration the guidance provided by the 2022 Organization of Economic Cooperation and Development Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations (‘OECD TP Guidelines’).
As such, UAE taxpayers should rely primarily on the CT Law, Ministerial Decision No. 97 of 2023, Cabinet Resolution No. 44 of 2020 and the UAE TP Guide. To the extent any aspect/issue is not covered, UAE taxpayers are encouraged to refer to the OECD TP Guidelines. Although the Guide is not a legally binding document, it will be the primary source of guidance for Transfer Pricing related matters going forward and can be used as an indication of how the FTA will consider the regime.
In the attached publication, we provide an overview of the UAE TP Guide in the context of the UAE Transfer Pricing rules and key takeaways for UAE businesses to address their Transfer Pricing framework going forward.
Click here to read the full Guide and here for KPMG Tax Flash on the Ministerial Decision No. 97 of 2023.
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