The Costa Rica tax authority (Dirección General de Tributación) on 13 November 2019, issued a resolution—DGT-R-49-2019—providing new guidelines with respect to transfer pricing documentation and concerning the rules for Master file and Local file documentation.
With the new guidance, a resolution from 2017 (DGT-R-16-2017) has been repealed.
The new guidelines provide that all taxpayers conducting transactions with related companies must retain documentation that supports their position that their intercompany transactions are similar to those with an independent party, as well as documentation that allows the tax authority to understand the operation and structure of the business group. The documentation that must be prepared by taxpayers in Costa Rica is based on the OECD’s base erosion and profit shifting (BEPS) Action 13.
The Master file must cover the following points:
The Local file is to include a description of the administrative structure of the local entity, and when the intercompany transactions of the taxpayer are requested, information about:
Read a November 2019 report (Spanish and English) [PDF 35 KB] prepared by the KPMG member firm in Costa Rica
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