Belarus: Review of transfer pricing measures effective in 2021

Belarus: Review of transfer pricing measures

Amendments to the Belarus tax code that update certain transfer pricing control provisions were enacted with the publication of Law N 72-3 in January 2021.


The changes were proposed in late 2020. Read TaxNewsFlash

Summary of transfer pricing rules

Among the legislative amendments concerning transfer pricing, effective in 2021, are the following items:

  • There is a new procedure for calculating the arm’s length range that disregards “extreme values” (interquartile range).
  • The list of information sources for conducting benchmark studies is refined and clarified.
    • The priority afforded different sources of information was repealed; now, information sources that allow for the greatest number of comparable criteria to be used are given precedence.
    • The "internal" source of information is clarified; now, transactions of a taxpayer's counterpart with third parties can also be used for analysis.
    • Data of European Economic Community (EEC) companies and if not available of other foreign companies are allowed for profitability analysis if there is none on the profitability of Belarusian companies in databases.
  • The possibility to use the results of independent valuations as the arm’s length price is expanded. Specifically, the notion of a "one-off transaction" has been introduced, and the number of permissible valuation methods in certain cases has been expanded. As before, the valuation is applicable for determining the arm’s length prices, provided certain requirements are met. More information about the valuation requirements for transfer pricing purposes is available from the Ministry of Tax and Duties.
  • Instances when transfer pricing documentation is required have been reduced. Specifically, Law No. 72-Z provides two additional exceptions:
    • Transfer pricing documentation is not required for controlled transactions if profits are exempt from income tax.
    • Transfer pricing documentation is not required if the amount of a separate, individual foreign trade transaction of a major taxpayer with a related party does not exceed 10% of the amount threshold (currently 200,000 Belarusian rubles) and cannot be grouped on the basis of the transactions being homogeneous. The issue of whether it is necessary to prepare and provide economic justification upon a request from the tax authorities for these transactions remains open.
  • Transactions with credit card international payment systems, registered in offshore zones, are excluded from the list of controlled transactions from the beginning of 2021.

KPMG observation

The amendments clarify the application of the transfer pricing rules in Belarus align the rules with those in neighbouring countries. Still, given that the practice of applying transfer pricing controls in Belarus is limited, and many issues still require careful research.

For more information, contact the Global Leader of KPMG’s Global Transfer Pricing Services:

Komal Dhall | +1 212 872 3089 |

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