Italy Enacted Rules on Trasfer Pricing Documentation
On Sept. 29, 2010 the Italian Tax Administration issued ruling n. 2010/137654 (for a copy of the ruling, click here) that implements the new provisions on transfer pricing documentation enacted by way of the law decree no. 78 of May 31, 2010 converted into law n. 122 of July 30, 2010. The Italian transfer pricing documentation is consistent with the EU Transfer Pricing Documentation Code of Conduct approved on June 26, 2006 and OECD Guidelines adopted in 1995 and subsequently updated. Multinational enterprises are required to file a notice with the tax administration confirming that they have prepared and are possession of the required transfer pricing documentation simultaneously with the filing of their annual tax return. Consequently, for 2010 tax year for calendar year taxpayer, the notice shall be filed with the tax return due in 2011. For previous taxable years, the notice must be filed within 90 days from the implementation of the rules (i.e., within December. 29, 2010), and in any event before any audit requests from the tax administration. The transfer pricing documentation provides protection from the statutory penalty that is applicable in case of transfer pricing adjustments (equal to minimum 100 percent and maximum 200 percent of additional tax due).
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