The Netherlands imposed new guidelines on the
transfer pricing, following the model provided by the
Organization for Economic Cooperation and Development (OECD). On the
11th of May 2018, the
Dutch authorities issued a
new Transfer Pricing Decree (
IFZ2018/6865), which prescribes new guidances on the application of the arm’s length principle.
The new legislation also includes the
OECD’s regulations on
Base Erosion and Profit Shifting (BEPS) and follows the
2017 OECD guidelines on
Transfer Pricing; the document also replaced the
Dutch Decree issued in November 2013.
Our Dutch accountants can offer in-depth information on the
tax regulations prescribed under the new legislation.
Transfer pricing methods in the Netherlands
The Netherlands applies all the transfer pricing methods that are prescribed by the OECD. At the same time, it may also accept pricing methods that are not included in the OECD Transfer Pricing Guidelines, but only in the situation in which they fall within the scope of the arm’s length principles. As a general rule, the Netherlands adopted the following pricing methods:
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• tangible property – in the case of marketing and sales activities, they are remunerated in accordance with the revenues established at a gross margin or at a net margin;
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• intangible property – in the case of transactions related to intangible property, it is generally applied the comparable uncontrolled prices; however, the profit-split method can also be applied;
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• service transactions – they are remunerated in accordance with the direct costs incurred; they can also be calculated following the transactional net margin method;
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• loans and advances – in this situation, the pricing is established following similar instruments.
New Dutch pricing methods following the OECD rules
Following the
new OECD regulations, the
Dutch Decree stipulates that the actual conduct of the parties can become more important than the contractual terms.
Our accounting firm in the Netherlands can offer more details concerning this regulation. Also, it is important to know that
risk control functions now have
a more important role in the
risk analysis of the
transfer pricing.
Companies operating in
the Netherlands are invited to
address to our Dutch accounting firm for more details on the
tax procedures available under the new
Decree regulating
transfer pricing following the
OECD regulations.
Our accountants can offer more details on the
pricing methods available for
tangible and intangible assets.