by Biene Ongenaert
On 1 July 2016, the documentation requirement for transfer pricing was introduced in Belgium. When it was introduced, it was also immediately communicated that failure to comply with these obligations would result in administrative fines of between 1,250 and 25,000 euros. The exact scales were published on 29 June 2018 by means of a Royal Decree in the Belgian Official Gazette.
With the publication of the Royal Decree, these administrative fines have now also entered into force. The application rules and the scales of the administrative fines regarding the failure to correctly comply with the documentation obligations for transfer pricing are clarified in the Royal Decree. Possible violations include the non-submission or late submission of documents, the submission of incomplete or incorrect documents and intentional tax evasion.
If the master file, the local file or the country report is not submitted or is submitted late or is incomplete, the tax authorities can impose a fine of between 1,250 euros and 25,000 euros on the Belgian group entity. However, if the tax authorities attribute the violations to malicious intent to evade tax, a fine of 12,500 euros can be imposed for the first offence. A fine of 25,000 euros can be imposed each time from the second violation.
Do you have any questions about transfer pricing? Please feel free to contact one of our specialists via email@example.com.
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