Discussion draft, revised guidance on profit splits | KPMG Global
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KPMG report: Discussion draft, revised guidance on profit splits

Discussion draft, revised guidance on profit splits

The Organisation for Economic Co-operation and Development (OECD) in June 2017 released a discussion draft related to the base erosion and profit shifting (BEPS) Action 10. The 2017 discussion draft followed a 2016 discussion draft on profit splits and proposed revised guidance on the application of the transactional profit split method.


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The OECD invited public comments on the 2017 discussion draft, to be submitted by 15 September 2017. The 2017 discussion draft included three questions in the preamble on which the OECD specifically requested comments. These relate to:

  • Factors to be taken into account in determining whether a profit split of anticipated profits or a profit split of actual profits is to be used
  • Profit-splitting factors—the relevance of capital or capital employed, headcount of similarly skilled and competent employees, adjustments for purchasing power parity, and other profit-splitting factors to be included in the guidance
  • Additional examples of scenarios in which a transactional profit split is found to be the most appropriate method due to the high level of integration of the business operations

Read a preliminary report (June 2017) about the discussion draft: TaxNewsFlash

Read the comments [PDF 113 KB] provided with respect to the discussion draft of the revised guidance on profit splits, as prepared by KPMG tax professionals.

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