Following the introduction of new transfer pricing rules in 2014 and the obligation to declare and document the related party transactions, the Albanian tax residents are facing an increasing scrutiny of the tax authorities on TP issues, local specifics of the regulatory framework and significant penalties for non-compliance.
With TP seen by the Albanian tax authorities as a relatively soft target, TP-related tax assessments have become more frequent and more material, the expertise of the tax administration is growing and the exchange of information with the foreign tax authorities is increasing.
Although the Albanian TP legislation mainly follows the 2010 OECD guidelines, the regulatory framework and the practice, it is marked by certain specifics and the master files might not always be sufficient to meet the local requirements.
All of this has made TP a critical issue for Albanian taxpayers having cross border transactions with related party entities. Apart from that, more and more companies recognize that effective transfer pricing policies may go far beyond simply enabling them to comply with local rules. Addressing TP issues before transactions actually occur may turn transfer pricing policies into strategic tools for supply chain decisions, as well as for global tax planning.
How KPMG can help
We help companies document transfer prices in accordance with the specific local transfer pricing rules and respond to rapid tax authority challenges, implement economically justifiable transfer pricing policies and execute forward-looking tax planning.
We can help companies manage their transfer pricing issues through such services as:
To assist in developing economically supportable transfer pricing policies and in executing forward-looking tax planning.
To provide insightful advice on developing and implementing policies, procedures, controls and systems for setting, monitoring, and testing intercompany transactions.
To help resolve transfer pricing disputes through various services, including assistance with advance pricing agreements, competent authority negotiations, arbitration, and litigation support.
To help manage risk within the current environment of detailed transfer pricing regulations, strict documentation requirements, sophisticated audit practices, and significant penalties for non-compliance with an objective point-of-view.
