India: Transfer pricing measures in Union Budget 2021-2022

India: Transfer pricing measures in Union Budget

The Finance Minister on 1 February 2021 presented the Union Budget 2021-22.


Among the tax measures related to transfer pricing matters in the budget are proposed changes to the length of time for assessment procedures. As proposed, the period of time for completing assessment proceedings involving transfer pricing referrals would be reduced from 24 months to 21 months (measured from the end of the assessment year). Consequently, the period of time for completing transfer pricing assessment proceedings would also be reduced from 22 months to 19 months.

Other transfer pricing-related provisions provide:

  • The taxpayer could file an application with the Assessing Officer for a recomputation of book-profits of earlier years, if there is an increase in the book-profits of a previous year as a result of an adjustment made pursuant to an advance pricing agreement (APA) or if there is a secondary adjustment.
  • In situations of a partnership required to furnish an accountant’s report (Form 3CEB), the due-date for filing the return of income of its partners would be extended to 30 November of the assessment year.

Read a February 2021 report [PDF 1.1 MB] prepared by the KPMG member firm in India

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