Singapore: Transfer pricing guide for multinational entity headquarters

An “e-Tax Guide” for multinational enterprise groups has been published.

An “e-Tax Guide” for multinational enterprise groups has been published.

The Inland Revenue Authority of Singapore (IRAS) published an “e-Tax Guide”—Transfer Pricing Guidelines Special Topic –Centralised Activities in Multinational Enterprise Groups.

The e-Tax Guide seeks to address some of the common transfer pricing considerations that are relevant to the multinational entity headquartered in Singapore. One key topic is the recognition that centralised activities and services are often undertaken by headquarter entities, and the e-Tax Guide provides additional guidance on how the transfer prices for such activities are to be analysed.

In general, the principles in the e-Tax Guide aligns with those set out in the IRAS Transfer Pricing Guidelines. The arm’s length principle continues to be endorsed, and taxpayers are required to perform comparability and functional analyses and select the most appropriate transfer pricing method when determining the arm’s length remuneration for centralised services.

The e-Tax Guide reiterates transfer pricing documentation requirements and also briefly mentions the tools (such as advance pricing arrangements and mutual agreement procedures) that are available to help taxpayers obtain early tax certainty or relief from double taxation.

Read a May 2021 report [PDF 426 KB] prepared by the KPMG member firm in Singapore

 

 

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