The Hong Kong government this week issued report of findings of a consultation and that explains the plans for implementing a new transfer pricing regime in Hong Kong law.
Comments received during the consultation period that ended 31 December 2016 reveal support for codifying transfer pricing rules into Hong Kong tax law. The government plans to introduce a legislative proposal by the end of 2017, and that bill can be expected to refer to the OECD’s transfer pricing guidelines (and noting which version is to be followed). The Inland Revenue Department (IRD) subsequently would be expected to issue guidance in an effort to facilitate an understanding of the transfer pricing rules (including measures that would authorize the IRD to adjust the profits or losses of entities that engage in non-arm’s length transactions with related parties).
The consultation report sets out the foundation for a transfer pricing regime, and addresses the following areas:
Read an August 2017 report [PDF 175 KB] prepared by the KPMG member firm in Hong Kong
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