Argentina: Restructured transfer pricing regime

Transfer Pricing Regime General Resolution (RG) 5903/2026, which replaces RG 4717/2020, significantly restructures the Argentine transfer pricing regime.

• Tested party and segmentation: The local entity is reinforced as the default tested party. RG 5903 mandates the segmentation of results by business line, product, or transaction type, requiring reconciliation with audited financial statements. Using a foreign entity as the tested party is permitted only in exceptional, duly documented cases.
• Transaction coverage and exclusions: All transactions with related parties and high-risk transactions must be analyzed—including non-computable items—unless the taxpayer can robustly demonstrate that they have no impact in any period.
• Comparables and loss-making companies: The standard remains restrictive: loss-making comparables are accepted only when there is a sound economic justification (e.g., market conditions, life cycle, etc.). RG 5903 now requires explicit documentation regarding the inclusion or rejection of each comparable and the information source used.
• Ranges and adjustment point: RG 5903 reaffirms the use of the interquartile range and the median as the default adjustment point when the taxpayer's result falls outside the range. Adjusting to another point within the range is permitted only in exceptional cases with robust technical support.
• Materiality thresholds and intermediaries: RG 5903 introduces a specific threshold of US$15 million per fiscal period (adjusted for CPI) for transactions involving intermediaries. Below this amount, documentation requirements for intermediaries are reduced; above it, enhanced documentation is required (substance, margin consistency, financial statements, and tax compliance).
• Commodities and hydrocarbons: RG 5903 coordinates with RG 5872/2026 and strengthens the regime for commodities, including hydrocarbons (gas/oil). Prices must be linked to observable benchmarks (e.g., Brent, gas indices), supported by clear documentation regarding formulas, quotes, and comparability adjustments (e.g., quality, delivery point, term, destination). The quote-based CUP method is preferred, and contract registration must align with the transfer pricing analysis.
• Methodology and comparability adjustments: The Local file must demonstrate a more formal methodology: mandatory segmentation, reconciliation with accounting records, and quantified comparability adjustments (e.g., inflation, exchange rates, extraordinary items, etc.), alongside a clear explanation of the method selected, the tested party, and the construction of the arm's-length range.
• Services and low value-added services: RG 5903 reinforces the requirement to substantiate the benefit and necessity of intercompany services, excluding duplicated costs or costs serving solely the group's interest. For low value-added services, a standard 5% markup on relevant costs is permitted, subject to specific conditions (e.g., no operating losses, no restructuring, limits based on operating figures) and detailed documentation regarding the nature of the service, beneficiaries, and allocation keys.
• Financial transactions: Intercompany loans and other financial transactions account for the borrower's financial capacity and the influence of the group's credit rating. RG 5903 requires robust documentation regarding contracts, interest rates, terms, guarantees, and market comparables, as well as a clear analysis of the substance behind cash pooling and centralized financing arrangements.
• Intangibles and DEMPE: RG 5903 explicitly adopts the DEMPE approach. The taxpayer must analyze local contributions based on DEMPE factors, justify the level of royalties or margins, and evaluate the role of marketing expenses. Intangibles that are difficult to value may require advanced methods (e.g., discounted cash flow (DCF)).
• Business restructurings: Internal restructurings (e.g., conversion from distributor to service provider, relocation of functions, transfer of intangibles) must be documented in detail, including changes in functions, assets, and risks, as well as whether an independent party would have received or paid compensation. This analysis must be included in the Local file whenever it affects value allocation.
• Deadlines: Article 70 of RG 5903 harmonizes filing deadlines. Form F.2668 and the Local file must be submitted in the seventh month following the close of the fiscal year (e.g., July for year-ends on December 31), on specific days determined by the last digit of the tax identification number (CUIT).

Read a September 2026 report (Spanish) prepared by the KPMG member firm in Argentina

For more information, read a KPMG report comparing RG 4717 and RG 5903 in table format, or contact a KPMG tax professional in Argentina:

Juan Martin Jovanovich | mjovanovich@kpmg.com.ar   

Elizabeth Hernandez | mehernandez@kpmg.com.ar