Qatar’s General Tax Authority (GTA) recently issued frequently asked questions (FAQs) that provide further clarity on several matters relating to transfer pricing (TP) compliance and documentation requirements. The FAQs also reiterate that the first filing obligation will be 30 June 2021 for taxpayers with a 31 December 2020 year end.
Qatar introduced TP rules in December 20191 and issued additional guidance in Decision No. 4 of 2020. The FAQs provide further guidance on the scope, content and timelines of the TP declaration, master file and local file, with practical examples to illustrate and clarify cases in which potential questions may arise.
The FAQs also provide insights as to how the GTA will use different sources of information to corroborate compliance with the arm’s-length principle, and how it will select cases for TP audit.
The FAQs also specify that TP documentation should be prepared on a contemporaneous basis (i.e., documentation to support the arm’s-length nature of the pricing of related party transactions should be prepared at the time of the transaction).
The FAQs also indicate that reporting will only be required for each category of related party transaction with an aggregate value of QAR200,000 or more.
Businesses in Qatar with related party transactions should review the TP rules, Decision No. 4 of 2020 and the FAQs and confirm that they are able to comply with the Qatar TP requirements for 2020 before the first compliance deadline (i.e., 30 June 2021 for taxpayers with the standard 31 December 2020 year-end).
For additional information with respect to this Alert, please contact the following:
EY Consulting LLC, Doha
EY Consulting LLC, Dubai
Ernst & Young LLP (United States), Middle East Tax Desk, New York