Transfer Fiyatlandırması Raporlamasının BEPS Kapsamında Yeniden Düzenlenmesi (İngilizce Versiyonu)

 Sirküler No: 2020 / 38

Tarih: 03.03.2020

Presidential Decree No.2151 was published in the Official Gazette dated 25.02.2020 and numbered 30971. According to the Presidential Decree, Turkey adopts the transfer pricing documentation standards under the OECD's Base Erosion and Profit Shifting (BEPS) Action 13 recommendations. The abovementioned Decree is based on three reports. The reports are as follows; 

• Master File 
• Annual Transfer Pricing Report (Local File) 
• Country by Country Reporting (CbCR) 
  Information about the reports documentation which shall be prepared by the taxpayers are summarized below; 

1.     Master File

Turkish corporate income taxpayers that are members of a multinational group with assets and net revenues of TL 500 million or more in the previous year will be required to prepare a master file for the fiscal year in 2019 and for the following fiscal years.  

The master file must be prepared by the end of the next fiscal year following the current fiscal year. A taxpayer with a calendar year end must prepare the master file pertaining to the 2019 fiscal year by December 31st, 2020. 

Companies with special accounting period shall prepare the first Master File for the accounting period that starts after January 1st, 2019. A corporate taxpayer with special accounting period starting on 1 April 2019 and ending on 31 March 2020 shall be required to prepare the first master file for this special accounting period ending on 31 March 2020 until 31 March 2021. 

On the other hand, the master file should be kept and submitted to the authorities in case that an official request. 

The requirements for the preparation of the master file is provided below, 

• Organizational structure of the multinational entities (MNE), 
• Intangibles of the multinational entities, 
• Intercompany financial activities of the multinational entities, 
• Financial and tax positions of the multinational entities.
   

2.     Annual Transfer Pricing Report (Local File)

The obligation to prepare transfer pricing report continues with the previous regulation. The annual transfer pricing report shall be prepared by the time the filing of corporate tax returns is due. On the other hand, the report should be kept and submitted to the authorities in case that an official request.

Taxpayers who is obligated to file are as follows; 

• Corporate income taxpayers registered to the Large Taxpayers Tax Office for their domestic and foreign related party transactions, 
• Companies registered to other Tax Offices for their foreign related party transactions, 
• Corporate income taxpayers that are operating in Free Trade Zones in Turkey for their related parties in Turkey, 
• All corporate income taxpayers for their transactions with their foreign branches and their related parties
   

3.     Country by Country Report (CbCR) 

The country by country reporting requirements applies to Multi National Group's ultimate parent company resident in Turkey with annual consolidated group revenue amounting to EUR 750 million or more in the accounting period prior to the reported accounting period. If the consolidated financial statements are in a different currency than the Euro they should be converted utilizing the average of the forex buying rates announced by the Central Bank of the Republic of Turkey pertaining to the previous fiscal year. 

The MNEs subject to CbC reporting, might file the report under "ultimate parent entity" or "surrogate entity" status.

Above mentioned report must be prepared until the end of the 12^th month following the accounting period and submitted to the Tax Authority by electronically. The Turkish ultimate parent entities of MNE groups are required to file the first CbC reports for the 2019 fiscal year until December 31st, 2020.  

On the other hand, the first country by country report shall be prepared for the special accounting periods that start after 01.01.2019 and filed electronically with the Tax 

Authority by the end of the following special accounting period by the taxpayers who having special accounting period. 

The country by country shall be include the global information of multi-national entity. The amendments are as follows, 

• Income related to each country where the multi-national operates, profit / loss before tax, income tax / CIT accrued, capital, retained earnings, number of employees, cash and tangible asset other than cash equivalents, 

• Name / title of each multi-national entity group company on country basis where they are resident. If the country where the company is established is different from the country where the company is resident in terms of taxation, the name of each country and main activities of each company.

Notification Obligation 

The information regarding which company will be the reporting entity whether it will be the ultimate parent entity or a surrogate entity shall be notified to the Tax Authority by Group members of an Multi-National which is within the scope of country by country reporting shall report.  

The above mentioned information must be notified the Tax Authority until the end of  June. On the other hand, The first CbCR shall be notified to the Tax Authority until August 31, 2020. 

You can access the Presidential Decree at the following address.

 https://www.resmigazete.gov.tr/eskiler/2020/02/20200225-25.pdf

Kind Regards,