Tuesday, 17 May 2016 10:57

Transfer Pricing - Penalties and Sanctions

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Entities which are obliged to declare and document their transactions with their related parties and are subject to transfer pricing provisions should be very careful in relation to the amounts that declare and the relevant deadlines, since the penalties that can be imposed due to errors or omissions are important.

More specifically, even though Law 4337/2015 has reduced significantly the range of the penalties, still there are severe and are as follows:

  • In case of inaccurate filing of the Summary Information Sheet, the penalty is equal to 0.1% of the transactions that should be documented,
  • In case of late filing of the amended Summary Information Sheet and provided that the amendment concerns a change of over € 200.000 in relation to the transactions that should be documented, the penalty is equal to 0.1% on the transactions that should be documented and
  • In case of inaccurate filing of the Summary Information Sheet where the inaccuracy concerns above 10% of the total transactions that should be documented the penalty is equal to 0,1% on the amounts concerned.

The above penalties cannot be lower than € 500 or higher than € 2.000.

  • In case of non filing of the Summary Information Sheet, the penalty is equal to 0,1% of the transactions that should be documented and cannot be lower than € 2.500 or higher than € 10.000.
  • Finally, in case of late or no disposal of the Transfer Pricing File to the Tax Authorities, the penalty varies and may be up to € 20.000 (In the case of failure to provide the tax authorities with TP File within 30 days from the official request, a penalty of €5.000 applies, which is increased to €10.000 if TP File is provided after 60 days and to €20.000 if it is provided after 90 days or it is not provided at all).

We remind you that the entities which have transactions with related parties (domestic or foreign) are obliged to prepare a Transfer Pricing File of intra-group transactions provided that such transactions exceed € 100.000 and the turnover of the liable party does not exceed € 5.000.000 annually or in case the intra-group transactions exceed € 200.000 and the turnover of the liable exceeds € 5.000.000 annually.

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