Taxes Archives - Page 15 of 17 - Academy of Tax Law

Sociedade Unipessoal, LDA vs Portugal

FP News, International Tax, Portugal, Postgraduate Programmes in Transfer Pricing, Tax Dispute Resolution, TP Case Summaries, Transfer Pricing / ATL-Editor

This case involves a dispute over the deductibility of financial costs related to loans taken out by the taxpayer (A…, Sociedade Unipessoal, LDA) to finance the acquisition of a 70% shareholding in a related company (C…). The Portuguese Tax AuthorityTax authorities are fundamental institutions within government frameworks, overseeing tax assessment, collection, and administration. Their operations ensure that tax laws are enforced and public funds are collected efficiently. This article delves into tax authorities' purpose, responsibilities, and structure, offering insights into their essential role in supporting government functions and economic stability. What is a Tax Authority? A tax authority is... More (AT) disallowed the deduction, arguing that these financial costs were not indispensable for generating taxable incomeThe tax base is a fundamental concept in taxation, representing the total amount of economic activity or assets upon which a tax is levied. It is the foundation upon which governments calculate the amount of tax owed, based on factors like income, property value, sales, or corporate profits. Understanding the tax base is essential for tax professionals, businesses, and policymakers,... More.

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Germany vs “Z Pipeline”: Transfer Pricing Disputes in Multinational Operations

Dispute Resolution, Germany, International, Tax Dispute Resolution, TP Case Summaries, Transfer Pricing / Dr Daniel N Erasmus

The FG Düsseldorf judgment of May 12, 2023, revolves around the transfer pricingTransfer pricing is a fundamental concept in international taxation that defines the pricing methods and rules applied to transactions between related entities within a multinational enterprise (MNE). In the context of tax regulations, it governs how prices for goods, services, or intangibles (such as intellectual property) are set when these items are exchanged between different branches, subsidiaries, or affiliates of... More dispute of a multinational enterprise operating a pipeline network across Germany, Belgium, and the Netherlands. The court found that the defendant’s method of profit allocation did not align with the arm’s length principle and violated the existing double taxationDouble Taxation occurs when the same income or financial transaction is taxed twice, typically in different jurisdictions. It can arise in two primary contexts: economic double taxation, where the same income is taxed twice in the hands of different taxpayers, and juridical double taxation, where the same taxpayer is taxed on the same income in more than one country. Double... More treaties.

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Dart Sudamericana Transfer Pricing Case

Argentina, Dispute Resolution, International, International Tax, Tax Dispute Resolution, TP Case Summaries / Dr Daniel N Erasmus

The case revolves around the transfer pricingTransfer pricing is a fundamental concept in international taxation that defines the pricing methods and rules applied to transactions between related entities within a multinational enterprise (MNE). In the context of tax regulations, it governs how prices for goods, services, or intangibles (such as intellectual property) are set when these items are exchanged between different branches, subsidiaries, or affiliates of... More methods used by Dart Sudamericana S.A. for the importation of EPS pellets from related companies. The primary contention was whether the Comparable Uncontrolled Price (CUP) methodThe Comparable Uncontrolled Price (CUP) Method is a transfer pricing approach that assesses whether the price charged in an intercompany transaction between related entities is consistent with the arm’s length principle. The arm’s length principle, a fundamental concept in transfer pricing, requires that the conditions of a transaction between associated enterprises be equivalent to those which would have been agreed... More or the Net Transaction Margin Method (NTMM) was appropriate for determining the arm’s length price of these transactions.

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Skechers USA Inc. vs. USA

FP News, International, Postgraduate Programmes in Transfer Pricing, Tax Dispute Resolution, TP Case Summaries, Transfer Pricing, United States / ATL-Editor

The Wisconsin Tax Appeals Commission ruled in favour of the Wisconsin Department of Revenue, affirming its disallowance of royalty deductions claimed by Skechers USA Inc. in relation to intercompany transactions between Skechers and its subsidiary, Skechers USA Inc. II

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3M Company v Commissioner of Internal Revenue: U.S. Transfer Pricing and Foreign Legal Restrictions

FP News, Postgraduate Programmes in International Tax, Postgraduate Programmes in Transfer Pricing, Tax Dispute Resolution, TP Case Summaries, Transfer Pricing, United States / Dr Daniel N Erasmus

The dispute focused on the income taxIncome Tax is a direct levy imposed by governments on the income generated by individuals, corporations, and other entities within a specific jurisdiction. It serves as a major source of revenue for governments and funds various public expenditures, such as infrastructure projects, healthcare, education, national security, and welfare programs. The tax is generally calculated as a percentage of the taxable... More treatment of intellectual propertyIntellectual Property (IP) refers to creations of the mind, including inventions, literary and artistic works, symbols, names, images, and designs used in commerce. It grants creators exclusive legal rights to use and exploit their work, ensuring protection against unauthorised use or reproduction. These rights are critical in fostering innovation and creativity while providing economic value to individuals and organisations. IP... More (IP) transactions between 3M’s U.S. subsidiaries and its Brazilian subsidiary, 3M do Brasil Ltda (3M Brazil), for the tax year 2006.

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Nokia vs. India: Permanent Establishment and Profit Attribution Dispute

FP News, India, International, International Tax, Permanent Establishment, Postgraduate Programmes in International Tax, Postgraduate Programmes in Transfer Pricing, Tax Dispute Resolution, TP Case Summaries, Transfer Pricing / Dr Daniel N Erasmus

The case revolved around whether Nokia Solutions and Networks Oy had a Permanent Establishment (PE) in India, and whether profits could be attributed to that PE under the India-Finland Double Taxation Avoidance Agreement (DTAA).

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Fiat Chrysler Finance Europe and Ireland v Luxembourg: State Aid, Transfer Pricing, and the Arm’s Length Principle

Arms Length Principle, EU, FP News, International, Luxembourg, Postgraduate Programmes in Transfer Pricing, Tax Dispute Resolution, TP Case Summaries / ATL-Editor

The case involves two appeals by Fiat Chrysler Finance Europe (formerly Fiat Finance and Trade Ltd) and Ireland, challenging the General Court’s decision to uphold a European Commission ruling that a tax ruling granted by Luxembourg to Fiat Chrysler Finance Europe constituted unlawful state aidState Aid refers to financial assistance provided by public bodies, typically governments, which can selectively benefit certain businesses or industries. This concept is critical in European Union (EU) law, where such support can distort competition and trade within the single market. State Aid, regulated under EU law, aims to ensure fair competition and prevent Member States from favouring local businesses... More.

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Eaton Corporation vs. IRS: Transfer Pricing Dispute

Dispute Resolution, International, International Tax, Tax Dispute Resolution, TP Case Summaries, Transfer Pricing, United States / Dr Daniel N Erasmus

Eaton Corporation, a global manufacturer of electrical and industrial products, faced significant tax disputesTax Disputes arise when there is a disagreement between taxpayers and tax authorities regarding the interpretation or application of tax laws. These disputes may concern various issues such as the accuracy of a tax return, the eligibility for tax deductions or credits, the correct amount of tax liability, or transfer pricing adjustments. Tax disputes can lead to lengthy legal proceedings... More with the IRS regarding its transfer pricingTransfer pricing is a fundamental concept in international taxation that defines the pricing methods and rules applied to transactions between related entities within a multinational enterprise (MNE). In the context of tax regulations, it governs how prices for goods, services, or intangibles (such as intellectual property) are set when these items are exchanged between different branches, subsidiaries, or affiliates of... More practices. The disputes centered around the company’s Advance Pricing Agreements (APAs)Advance Pricing Agreements (APAs) have emerged as a critical tool for managing transfer pricing challenges. APAs are formal agreements between a taxpayer—often a multinational enterprise (MNE)—and one or more tax authorities that pre-determine the appropriate transfer pricing methodology for specified intercompany transactions over a set period, typically up to five years, with the possibility of renewal. The primary purpose of... More with the IRS, which were intended to establish transfer pricingTransfer pricing is a fundamental concept in international taxation that defines the pricing methods and rules applied to transactions between related entities within a multinational enterprise (MNE). In the context of tax regulations, it governs how prices for goods, services, or intangibles (such as intellectual property) are set when these items are exchanged between different branches, subsidiaries, or affiliates of... More methodologies for transactions between Eaton and its subsidiaries. The APAsAdvance Pricing Agreements (APAs) have emerged as a critical tool for managing transfer pricing challenges. APAs are formal agreements between a taxpayer—often a multinational enterprise (MNE)—and one or more tax authorities that pre-determine the appropriate transfer pricing methodology for specified intercompany transactions over a set period, typically up to five years, with the possibility of renewal. The primary purpose of... More were canceled by the IRS, leading to a tax court case in 2017 and an appeal in 2022.

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Medtronic vs Commissioner of Inland Revenue

International, Postgraduate Programmes in Transfer Pricing, Tax Dispute Resolution, TP Case Summaries, Transfer Pricing, United States / ATL-Editor

The case of Medtronic, Inc. vs. Commissioner of Internal Revenue revolves around the complex issue of transfer pricingTransfer pricing is a fundamental concept in international taxation that defines the pricing methods and rules applied to transactions between related entities within a multinational enterprise (MNE). In the context of tax regulations, it governs how prices for goods, services, or intangibles (such as intellectual property) are set when these items are exchanged between different branches, subsidiaries, or affiliates of... More, particularly concerning the appropriate method to determine the arm’s length royalty rates for the use of intellectual propertyIntellectual Property (IP) refers to creations of the mind, including inventions, literary and artistic works, symbols, names, images, and designs used in commerce. It grants creators exclusive legal rights to use and exploit their work, ensuring protection against unauthorised use or reproduction. These rights are critical in fostering innovation and creativity while providing economic value to individuals and organisations. IP... More between Medtronic US and its Puerto Rican subsidiary, MPROC.

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Ferragamo France Transfer Pricing Case: Key Lessons for Luxury Brands

Dispute Resolution, France, International, International Tax, Tax Dispute Resolution, TP Case Summaries, Transfer Pricing / Dr Daniel N Erasmus

The Ferragamo France transfer pricingTransfer pricing is a fundamental concept in international taxation that defines the pricing methods and rules applied to transactions between related entities within a multinational enterprise (MNE). In the context of tax regulations, it governs how prices for goods, services, or intangibles (such as intellectual property) are set when these items are exchanged between different branches, subsidiaries, or affiliates of... More case offers valuable insights for luxury goods companies. This landmark ruling highlights the complexities of transfer pricingTransfer pricing is a fundamental concept in international taxation that defines the pricing methods and rules applied to transactions between related entities within a multinational enterprise (MNE). In the context of tax regulations, it governs how prices for goods, services, or intangibles (such as intellectual property) are set when these items are exchanged between different branches, subsidiaries, or affiliates of... More in the high-end retail sector.

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