Spain’s Draft Regulations on Transfer Pricing Rules

excerpt from Practical European Tax Strategies written by Pedro Aguarón (Baker & McKenzie Barcelona, S.L.)

As a result of the new Law for Avoidance of Tax Fraud (LATF) enforceable in 2007, the Spanish transfer pricing legal framework has changed significantly.

One notable change is that the LATF introduced specific transfer pricing requirements. The taxpayer is required to properly document that the price used in related transactions is arm’s length and make this documentation available at the tax authorities’ request.

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