This consultation seeks views on two related proposals.
- The first proposal is to amend the current exemption from transfer pricing for small and medium-sized enterprises (SMEs), to better define and defend the UK tax base. – this proposal considers the removal of the exemption for medium-sized enterprises and possible changes to the definition of small enterprises.
- The second proposal is to introduce a requirement for multinationals to report information on cross-border related party transactions to HMRC through an International Controlled Transactions Schedule (ICTS). – this includes the introduction of a requirement to file an ICTS by all businesses regardless of the Group size.
These proposals sit alongside the government’s proposal to reform UK law in relation to transfer pricing, permanent establishment (PE), and Diverted Profits Tax. We will share mode details on this separately.
Transfer pricing reform includes the general repeal of the requirement to apply transfer pricing to UK-to-UK transactions.
