SARS Draft Interpretation Note, issued March 22, 2013, describes in Section 7 “Risk Assessment and Selection of Cases for Audit,” concepts for determination of thin capitalization thresholds and an arms-length rate of interest on inbound loans. The Note is attached for reference. From a Best Practices approach, I have the following queries:
- How are Treasury & Tax functions aligned to maximize opportunities for this type of development?
- How are you timely notified of such developments (i.e. local Business, external advisors, Tax Notes Int’l., etc)
- Does your company have a stated process re: providing public comment for such guidance?
- From a RACI Model perspective, are roles aligned to address this Note?
- Who determines if proactive debt/equity planning scenarios are reviewed, and relevant timelines?
- How are the proposed transfer pricing analyses integrated into the transfer pricing documentation framework?
I welcome your input.