18 December 2019
On 2 September 2019, the Department of Finance issued a feedback statement concerning the proposed update to Ireland's transfer pricing rules. The feedback statement follows a public consultation, to which William Fry Tax Advisors/TAXAND Ireland contributed. The public consultation was launched on 18 February 2019. The feedback statement can be viewed here.
The proposed legislation, while still in draft form, reflects a pragmatic and sensible approach taken by the Department of Finance concerning the implementation of the updated 2017 OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations (the 2017 Guidelines) and in particular takes into account key concerns raised in our consultation submission.
In line with our recommendations, the draft legislative changes focus on harmful tax practices and seek to carve out domestic transactions and certain capital transactions below a material threshold of €25 million from the scope of the extension to the transfer pricing rules. This is to be welcomed and should be seen as a significant boost to domestic businesses who are facing increased burdensome compliance costs and who would have been disproportionately impacted by a full introduction of the 2017 Guidelines.
A further consultation period ran until 13 September 2019 for feedback from stakeholders.