Hvornår er en transfer pricing-dokumentation fyldestgørende? Og hvilke konsekvenser har det, hvis dokumentationen ikke er fyldestgørende?

Abstract

Based on corporations that are obligated to annually submit a transfer pricing documentation, this thesis examines when a transfer pricing documentation is considered adequate by the Danish Tax Authorities, and what the consequences are, if the documentation is insufficient.
The transfer pricing documentation must analyze the most significant controlled transactions and document, that the transactions are set at arm’s length. Meaning that a third party would have concluded a similar transaction, on similar terms and at a similar price. If the documentation is inadequate and cannot fulfill its purpose, the Tax Authorities may perform a discretionary assessment. Further, if the corporation has acted with gross negligence, the corporation not fulfilling the requirements risks a fine.
For income years beginning on the 1st of January 2021 and forward, taxpayers that are obligated to prepare a transfer pricing documentation, must do an annual submission of the documentation to the Danish Tax Administrations. The obligation to do an annual submission of the transfer pricing documentation is supporting the recommendation from OECD of preparing the documentation on a contemporaneous basis.
Interpretation of the Danish legislation must be in accordance with the OECD’s transfer pricing guidelines, further, case law is crucial for the understanding of how the laws are applied in practice. On the 6th of September 2023 the Supreme Court ruled in favor of the Danish Tax Authorities in the MOGAS-case. The Supreme Court ruling is, together with other relevant cases, analyzed in the thesis in relation to requirements for the transfer pricing documentation, for the Tax Authorities access to perform a discretionary assessment and in relation to the fines related to transfer pricing.
With the newest Supreme Court ruling it is established that, when necessary, transactions that are difficult to separate, may be priced together. Further, the Supreme Court ruling has emphasized the importance of including all transactions in the documentation, including transactions which the parties consider not having any value. Only the material transactions need to be analyzed in the documentation, but every transaction must be presented in the documentation.