Principal Issues: [ TaxInterpretations translation ]Does the CRA intend to issue a new version of Information Circular 87-2R -- International Transfer Pricing ("Circular 87-2R") in the near future that will reflect the new 2010 version of the OECD Guidelines?
Position: No
Reasons: A new transfer pricing memorandum will eventually be published to reflect the new version of the OECD Guidelines published in 2010.
Federal Tax Roundtable, 5 October 2012
2012 APFF Conference
Question 22
New Circular -- International Transfer Pricing (ITF)
In Canada, transfer pricing is essentially governed by section 247 and by Information Circular 87-2R issued by the CRA. These are largely based on the Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations, published in 1995 by the Organization for Economic Co-operation and Development (the "OECD" and "OECD Guidelines").
In the new 2010 edition of the OECD Guidelines, some chapters have been substantially revised, with further guidance on the selection of the transfer pricing method most appropriate to the circumstances of the case, on how to apply transactional profit methods (the transactional net margin method and the profit split method) and on how to perform a comparability analysis.
Question to the CRA
Does the CRA intend to issue a new version of Information Circular 87-2R -- International Transfer Pricing ("Circular 87-2R") in the near future that will reflect the new 2010 version of the OECD Guidelines?
CRA response
The CRA does not intend to publish a new version of Circular 87-2R. However, a new transfer pricing memorandum will eventually be published to reflect the new version of the OECD Guidelines published in 2010. Transfer pricing memorandums are available on the CRA website at the following address:
http://www.cra-arc.gc.ca/tx/nnrsdnts/cmmn/trns/menu-eng.html
Anne Dagenais
(613) 957-2121
2012-045420