GCC: Transfer Pricing (TP) Regulations
![GCC: Transfer Pricing (TP) Regulations]()
- Saudi Arabia
- Introduced in February 2019
- TP disclosure form and affidavit to be submitted to the Zakat, Tax and Customs Authority (“ZATCA”) 120 days after the year’s end.
- Local File and Master File must be in place 120 days after year’s end and should be submitted to GAZT only upon request.
- QATAR
- Introduced in December 2019
- TP questionnaire and disclosure to be submitted to the General Tax Authority (“GTA”) 120 days after the year’s end for all MNEs with turnover and assets exceeding 10 million Qatari riyal ($2.7 million).
- Local File and Master File must be in place at the time of tax return submission.
- Bahrain
- Introduced in February 2021
- CbCR Notification and CbC Report to be filed on or before the last day of the reporting year.
- CbCR threshold is 342 million Bahraini Dinar ($900 million) of consolidated revenue of the MNE group in the preceding year.
- Introduced in September 2020
- CbCR Notification to be filed on or before the last day of the reporting year and CbC Report to be filed within 12 months from the last day of the reporting year.
- 300 million Omani Riyal ($780 million) of consolidated revenue of the MNE Group in the preceding year.
- UAE
- CbCR - the UAE has implemented BEPS Action 13 only in part, through the introduction of Country by Country Reporting (“CbCR”) in 2019. The UAE CbCR regulations in the UAE are effective for fiscal years starting on or after 1 January 2019 for multinational groups with revenues over AED 3.15 billion ($858 million).
- Local File/Master File – starting June 2023, the UAE will introduce TP regulations which are expected to be largely inspired by OECD Transfer Pricing guidelines. In addition to the CbCR, the TP regulations will introduce both the Local File and Master File. Further, all transactions between related parties will have to be carried out on arm’s length terms or as if the transaction was carried out between independent parties.
- The introduction by the UAE of 3-Tier Documentation forces businesses to reconsider their TP strategy. Corporate Tax and TP are intertwined with each other, and no comprehensive international Corporate Tax strategy can be envisaged without an in-depth understanding and control of the TP life cycle within an MNE.
- With the upcoming TP regulations, those MNEs that have placed their Economic Substance in the form of people, capital, and assets in the UAE, will obtain a competitive edge over their competitors. Further, such MNEs will be able to structure their entire Corporate Tax and Transfer Pricing policy in a way to centralize most of their profits in the UAE and benefit from the relatively low Corporate Tax rate of 9% (excluding Pillar Two MNEs that will likely be subjected to the 15% Corporate Tax).
