Chilean Revenue Authority Increases Staff Size

June 20, 2018

Chilean Revenue Authority Increases Staff Size

~1-minute read. This article is part of our CrossBorder Audit Alert series.

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Chile Announces Staff Increase for TP Audits

 

The Chilean Internal Revenue Service (Servicio de Impuestos Internos of SII) announced in 2016 they were seeking to collect USD $265M in transfer pricing adjustments.

The SII opened 255 transfer pricing audits in 2016. That number is expected to trend upwards as the years progress. The SII also drafted proposed regulations to significantly raise penalties.

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In an attempt to raise revenue and lower the budget deficit, HM Revenue and Customs announced that that between 2011-2016, HMRC secured 5.9 billion of additional tax by challenging the transfer pricing arrangements of multinational corporations! The total amount secured in 2016/17 was 1.6B which was a 50% increase over the amount collected in 2015/16.

Similarly, the Diverted Profit Tax, which is designed to encourage large companies to comply with international tax rules including transfer pricing, raised 281M in 2016/17. This was a 90% increase from 2015/2016.

To collect this amount, the HMRC has 82 full time staff in its specialist transfer pricing group. This number is expected to increase dramatically.

CrossBorder Solutions predicts that this upward trend will continue and MNC taxpayers should expect transfer pricing audits and adjustments to increase dramatically.

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