Transfer pricing in Spain are the prices established in transactions carried out between companies of the same group. Through this price, goods, services, profits, etc. are transferred between both companies.
In the past few years, transfer pricing have been one of the most important fiscal issues for companies that operate internationally, both in Spain and in most other countries. The coexistence of an increasingly globalised and complex environment with the asymmetries offered by the different national tax laws has permanently generated situations of inevitable conflict between tax administrations and taxpayers for the possible transfer of tax bases between States.
Sanctioning procedure – transfer pricing in Spain
Spanish regulation, through numeral 10 of article 16 of Corporation Tax Regulation, determines the sanctioning procedure, both for not providing or for providing inaccurate, false or incomplete documentation, and for the market value derived from documentation which is not that reflected in the declaration.
The applicable sanctions depend on:
If there is no value adjustment to be made by the Administration:
- 1,500 Euros for omitted, false or inaccurate data.
- 15,000 per data set.
In the cases of companies whose net amount of turnover in the tax period is less than 10 million Euros, for which the exemption of documentation established in section 2 of article 16 of the TRLIS does not apply, the sanction will be, as a maximum limit, the lower of the following two amounts:
- 10% of the total set of operations carried out in the tax period with respect to those that have failed to comply with the obligation or
- 1% of net revenues.
Summary – transfer pricing in Spain
In summary, given the growing globalisation of the business society and the operations between related companies, it is vital to know whether your company is complying with the regulations established by the OECD regarding transfer pricing in Spain. Our specialised Transfer Pricing team in Spain is fully available to investigate this subject, as well as to assist you in any act or procedure related to the case.