What circumstances can an APA be considered for renewal?

04:10, 10/07/2024

The Ministry of Finance addresses this content in Circular 201/2013/TT-BTC, providing guidance on the application of Advance Pricing Agreements (APA) in tax management.

Currently, an APA is effective for a maximum period of 5 years. The effective date shall not be earlier than the date the taxpayer submits the APA application.

Extension of APA, Circular 201/2013/TT-BTC

Illustrative image (source: internet)

On the other hand, an APA may be extended for an additional period not exceeding 5 years.

To be specific, as stipulated in Circular 201/2013/TT-BTC, an APA may be considered for an extension in the following cases:

- The scope of related-party transactions and related parties has no significant change;- Key assumptions have no significant change;- The arm's length price range or the gross profit margin or net profit margin basis for comparative analysis remains stable during the extension period.

Additionally, Circular 201 also specifies the procedures for extending an APA:

- The taxpayer must submit the APA extension application to the tax authority at least 6 months before the signed APA expires;- The procedures for resolving the APA extension application are similar to those for the initial APA application.

Details can be found in Circular 201/2013/TT-BTC, effective from February 5, 2014.

Thu Ba

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