Post by Sapphire Capital on Oct 29, 2008 20:13:20 GMT 4
Belgium: Companies involved in business reorganisations face transfer pricing audits
Source: ITR: Dirk Van Stappen KPMG
Companies involved in business reorganisations or in a redesign exercise of the supply chain get special attention from the transfer pricing audit department of the Belgian tax authorities. This department hosts tax inspectors who specialise in transfer pricing matters and has the countrywide authority to carry out transfer pricing audits on top of the regular tax audits carried out by local tax offices.
Entirely in line with the contents of the transfer pricing circular letter of November 14 2006 and the recent developments in other countries (e.g. Germany), the transfer pricing audit department of the Belgian tax authorities has paid special attention during the last months to multinational groups of which the Belgian members have been involved in, business reorganisations or in the entire or partial transfer to abroad of entities and/or operations. Herewith one should especially consider Belgian companies, which operated previously as distributor or (fully fledged) sales company and which have been converted into a commissionaire or sales agent. In a production environment it seems that especially converted contract manufacturers and toll manufacturers attract the attention of the transfer pricing audit department.
During such transfer pricing audits, special attention is paid to the valuation of intellectual property (e.g. patents and know how) and of goodwill. Also restructuring expenses or provisions, borne or accounted by the Belgian group members, are tested on their deductibility for tax purposes and whether they are in line with the functional profile of the group companies concerned.
contact: Dirk Van Stappen at dvanstappen@kpmg.com
Source: ITR: Dirk Van Stappen KPMG
Companies involved in business reorganisations or in a redesign exercise of the supply chain get special attention from the transfer pricing audit department of the Belgian tax authorities. This department hosts tax inspectors who specialise in transfer pricing matters and has the countrywide authority to carry out transfer pricing audits on top of the regular tax audits carried out by local tax offices.
Entirely in line with the contents of the transfer pricing circular letter of November 14 2006 and the recent developments in other countries (e.g. Germany), the transfer pricing audit department of the Belgian tax authorities has paid special attention during the last months to multinational groups of which the Belgian members have been involved in, business reorganisations or in the entire or partial transfer to abroad of entities and/or operations. Herewith one should especially consider Belgian companies, which operated previously as distributor or (fully fledged) sales company and which have been converted into a commissionaire or sales agent. In a production environment it seems that especially converted contract manufacturers and toll manufacturers attract the attention of the transfer pricing audit department.
During such transfer pricing audits, special attention is paid to the valuation of intellectual property (e.g. patents and know how) and of goodwill. Also restructuring expenses or provisions, borne or accounted by the Belgian group members, are tested on their deductibility for tax purposes and whether they are in line with the functional profile of the group companies concerned.
contact: Dirk Van Stappen at dvanstappen@kpmg.com