Strategizing International Tax Best Practices – by Keith Brockman

The Nigerian Transfer Pricing (TP) Division of the Federal Inland Revenue Service (FIRS) has requested companies to submit copies of their Group’s Transfer Pricing Policy.  Additional details of this request are included in the KPMG link for reference:

https://www.kpmg.com/Global/en/IssuesAndInsights/ArticlesPublications/taxnewsflash/Documents/tp-nigeria-march11-2014v2.pdf

Although this request is directed towards a “Transfer Pricing Policy” the initiative is an indication of the focused transfer pricing objectives of developing countries, and heightened awareness for application of the “arm’s-length” principle.  The initiative is interesting due to the fact that the request is for a macro basis policy re: arm’s-length transactions between related entities, vs. a detailed template of information that may not have direct relevance on assessing risk from a transfer pricing perspective.

For Best Practices, this request invites multinationals to develop a general transfer pricing policy as an integral part of the Tax Risk Framework documentation, with potential application of a useful documentation tool to provide publicly as applicable.

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