China – Workshop: Transfer pricing challenges under the background of BEPS

Published on April 12, 2018

Since G20 and OECD launched the Base Erosion and Profit Shifting ("BEPS") project, many countries have actively responded to the project which makes the international tax environment increasingly transparent.

With the implementation of TP documentation and Country by Country Reporting ("CbCR") in various countries, the distribution results of multinational groups’ profits along the global value chain become clear. However, the tax authorities in various jurisdictions may hold different views on the distribution results and the functions performed and risks borne by the local entities. Some parent companies are required by the local tax authorities to review and adjust their global TP policies. Such adjustments are often difficult to implement in China as they are subject to strict supervision of various authorities, such as tax authorities, State Administration of Foreign Exchange ("SAFE"), and the Customs.

In addition, the Chinese tax authorities have also strengthened the anti-avoidance management and released a series of TP regulations in recent years. This makes the compliance work of Chinese subsidiaries more difficult. The information disclosed by the Chinese subsidiaries shall be complete but prudent, and consistent with the description of the TP policies stated by their parent companies. Therefore, under the BEPS background, it has become a new challenge for the Chinese subsidiaries to respond to the TP challenges from the overseas and domestic tax authorities and their German parent companies, manage the compliance work, and control TP risks.

Topics

• When the TP results deviate from the group policy, the parent company wishes to conduct TP adjustments;
• The parent company requires a substantial price adjustment in the next year;
• Why service fees and royalties charged by the parent company to Chinese subsidiaries have been questioned by the Chinese tax authorities and which special requests from the Chinese tax authorities should be considered;
• The deductibility, tax burden and foreign exchange considerations of other related party transactions;
• Do the Chinese subsidiaries need to submit Master File, if their parent companies have prepared it? How to supplement and revise the Master File according to the differences between the Chinese TP regulations and OECD? How to avoid transfer pricing risks?

 You may also raise questions during the workshop and seek for professional comments during the workshop.

Details

• Roedl & Partner Shanghai can only accept 20 participants;
• The registrations deadline for the upcoming workshop is April 23, 2018;
• The workshop is on April 27, 2018 and starts at 2:00 pm until 4:30 pm;
• The language is chinese;
• The costs for the workshop amount to RMB 1.050, including snack and drink.

If you are interested in such event, please feel free to contact Ms. Elisa Guo (email: elisa.guo@roedl.pro / Tel: +86 21 6163 5209) to reserve a seat.