Transfer Pricing

AFIP´s Compliance Requests

A few days ago, AFIP began an extensive campaign of requirements to taxpayers for compliance with two Information Regimes related to Groups of Multinational Entities (MNGE). It is, on the one hand, the Register of Related Parties, and on the other, the Information Regime for entities that are part of a GEMN.

As for the Register of Related Parties, it is an information regime that had been implemented by AFIP in 2013 (General Resolution “GR” AFIP 3572/2013) with two chapters. Chapter I consisted of a web service created to register all related parties (domestic or foreign) (“the Registry”); while Chapter II requested to report domestic transactions with related parties, through a monthly affidavit (F.4502).

Although this information regime was in force, many taxpayers chose not to submit it, given the excessive workload it represented, to the extent that the report of local transactions (Chapter II) was somehow deprecated, and was finally derogated by AFIP in 2019. After this modification, only the registration obligations established in Chapter I remained in force, as well as those to keep the Registry up to date. Within 10 days of the occurrence, any event that configures a change relating to the local or foreign related subjects shall be registered.

The Registry regained relevance since the new regulatory framework of the Transfer Pricing regime after the sanction of the GR AFIP 4717/2020, where the uploading of the related parties to the annual Transfer Pricing (“TP”) Return form F.2668 is automatically absorbed from the Registry, thus forcing it to be kept updated.

Regarding the Information Regime for taxpayers belonging to a MNGE, it has been in force since 2017, according to GR AFIP 4130-E/2017, and requires local taxpayers who have the status of belonging to a GEMN to report who their Ultimate Parent Entity (“UPE”) is, consolidated revenues of the MNGE and other formal data regarding said entity.

In addition, the aforementioned GR also regulates the submission of Country-by-Country Reports, aligning Argentina with the international standards arising from the OECD’s BEPS Plan.

In this sense, the gaze of the tax authorities worldwide is increasingly shifting from the individual taxpayer and focusing on the MNGE. AFIP has done the same and began requiring taxpayers to complete this information regime by filing form F.8096. This is a relatively simple form to complete, but its non-compliance can lead to significant fines.

From the above, it is important to keep both informative regimes up to date, in order to avoid fines or having to comply with AFIP requirements within very short deadlines, with the difficulties that may entail gathering information from related companies and the UEC.