New rules introduced define how to interpret arm’s length principle for inbound financial transactions
The upper house of the German Parliament (Bundesrat) on 22 March 2024 approved the compromise proposal for the "Act to Strengthen Growth Opportunities, Investment and Innovation as well as Tax Simplification and Fairness”. Read TaxNewsFlash.
As part of this new legislation, new rules are introduced into German tax law that define “the German way” on how to interpret the arm’s length principle for inbound financial transactions and as such set the requirements for taxpayers to consider in both their transfer pricing analysis as well as their transfer pricing documentation.
In a nutshell some key outtakes:
Read an April 2024 report prepared by the KPMG member firm in Germany that describes the new rules.