The legal requirement to prepare transfer pricing documentation already applies to fiscal years beginning on or after 1 January 2016. However, because the Decree was late in being published, the deadline for completing certain formalities has been extended.
1. Country report
The country report is identical to the models prepared by the OECD. The deadline for submission is 12 months after the end of the reporting year (in most cases, 31 December 2017). Linked to this, the Belgian legislator has introduced a notification obligation. This means that Belgian group entities must report at the end of the year which entity within the group will prepare the country report. The deadline for this has been extended as a one-off measure until 30 September 2017.
For Belgian entities, there is also a master file and a local file that must be prepared once certain thresholds are exceeded.
2. Master file
In the master file, the Belgian entity provides an overview of the organisational structure, operations, intangible assets, financial activities and financial and tax position. The deadline for submitting the master file - just like the country report - is 12 months after the end of the reporting year.
3. Local file
The local file consists of two forms. The first form contains general information about the company; the second form displays detailed information on the various transactions for each business unit. The second form is only required if the company exceeds the threshold of 1 million for cross-border transactions with group entities in the most recent financial year. The first form must be submitted when filing the corporate income tax return for the 2016 income tax year (usually 30 September 2017). The second form must normally be submitted when filing the corporate income tax return for the 2016 income tax year. However, on this occasion a time extension has been granted, so that the form can be submitted when filing the corporate income tax return for the 2017 income tax year (in most cases 30 September 2018).
If you require assistance in completing these formalities, please feel free to contact one of our specialists.