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Burkina Faso

14 January 2022

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Burkina Faso Publishes Law for 2022 Budget Including Revised Transfer Pricing Documentation Requirements

Burkina Faso published the Finance Law for the 2022 Budget (Law No. 042/2021/AN) in the Official Gazette on 31 December 2021. Some of the main measures of the law include the following:

  • All companies, whatever their form and activities, are required to maintain a register of their beneficial owners and submit a declaration on the identity of beneficial owners within the due date for the annual tax return (generally 30 April), including any changes, which applies for existing companies and newly created companies;
  • Transfer pricing documentation requirements are revised:
    • the annual turnover or gross assets threshold for companies required to maintain transfer pricing documentation in relation to transactions with related resident and non-resident parties is reduced from 3 billion CFA francs to 1 billion CFA francs, which also applies for companies with majority holding in a company meeting the threshold and companies that are majority held by a company meeting the threshold;
    • the documentation must include general information on the group of related parties as well as specific information concerning the company, and should be available on the date of initiation of an audit, but if not available or only partially, a formal notice will be issued to produce or complete the documentation within 30 days;
    • companies meeting the above threshold are also required to submit an annual transfer pricing statement by 31 May of the following year;
    • companies not meeting the above threshold may be requested to provide documentation to the tax authority;
  • A new "tax flagrance procedure" is introduced in the context of accounting verification procedures:
    • this provides that a tax flagrance report may be issued where a taxpayer engages in activities not reported to the tax authority, issues invoices that do not correspond to the actual delivery of goods or services, takes deductions for invoices that do not correspond to actual operations, etc.; and
    • where a taxpayer has been the subject of a tax flagrance procedure, the tax authorities may make their own assessment of a taxpayer's tax base (added to the list of cases in which such an assessment may be made).

The measures of the law are generally effective from 1 January 2022.

Click the following link for a copy of the Finance Law for the 2022 Budget published by a third party.

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