The Taiwan Ministry of Finance (MOF) released on August 18 a draft amendment to the Rules Governing Assessment of Profit-Seeking Enterprise Income Tax on Non-Arm’s Length Transfer Pricing (TP Assessment Rules). Once the notice period is over, the amendment will be effective from January 1, 2020.
The amendment is drafted based on BEPS Action Plans 8-10's Final Report: Aligning Transfer Pricing Outcomes with Value Creation, and on the 2017 amendment on Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations. The focus of this amendment includes the disclosure of a step-by-step risk analysis, the alignment of functional analysis of intangible assets with profit attribution, and the application of a lower threshold penalty for a failure to disclose.
