In this edition of the newsletter, you will find the most important national and global developments in tax law that are (closely) related to the transfer pricing world.
Please feel free to contact us if you have any questions.
Quantera Global News and Developments
- On 26 August, we published a blog on the transition of Transfer Pricing and how global developments and AI are shaping the future of our profession. You can read the blog here. The related episode of oud podcast is available on Spotify, YouTube, and on our website.
- On 11 August, we published a case study on a Strategic Global TP Transformation for a Multinational Corporation. You can read the case study here.
Quantera Global Specialties
In the past month, several challenging and noteworthy projects were successfully completed, including:
- Preparation of a Country-by-Country report.
- Setting up a pragmatic approach for determining at arm’s length interest rates Inhouse for a large stock quoted company.
- Transfer Pricing documentation compliance and managing related filing deadlines such as in Denmark.
If you would like to know more about these topics, please feel free to contact us.
News from around the world:
Australia
- On 6 August, the Australian Taxation Office released Draft Practical Compliance Guidelines, providing certainty on whether cross-border payments regarding software arrangements, are royalties subject to withholding tax.
- On 13 August, the High Court of Australia ruled in the case concerning PepsiCo and Stokely-Van Camp. The companies had agreements with Schweppes Australia for the sale of concentrate, without royalties for the use of trademarks or other intellectual property. The tax authorities argued that part of the payments should be treated as royalties or diverted profits. The Australian High Court rejected this view, ruling that the payments were for concentrate only. It confirmed that no royalty withholding tax or diverted profits tax was payable.
Bahrain
On 12 August, the National Bureau for Revenue published updated guidance on the domestic minimum top-up tax, covering scope of entities and advance payment rules. For in-scope MNE groups with a 31 December year-end, the first advance payment is due by 31 August 2025.
Belgium
In August 2025, Belgium released several treaty updates including new synthesized texts under the Multilateral Instrument (MLI). These include:
- 1 August – French texts for the Belgium–Canada and Belgium–Tunisia treaties.
- 4 August – French text for the Belgium–Finland treaty and Dutch text for the Belgium–France treaty.
- 5 August – Dutch texts for the Belgium–Iceland and Belgium–Luxembourg treaties.
Brazil
On 15 August, the Brazilian Federal Revenue Service (Receita Federal do Brasil – “RFB”) and the National Treasury Attorney’s Office (Procuradoria-Geral da Fazenda Nacional – “PGFN”) introduced a tax settlement program for disputes on the “Resale Price Less Profit” method. In general terms, the tax settlement framework allows taxpayers to negotiate outstanding tax liabilities under more favorable conditions, such as principal reductions, extended payment terms, and/or relief from interest and penalties.
The program runs until 28 November 2025.
Canada
On 15 August, the Department of Finance released draft legislation covering Excessive interest and financing expenses limitation exemptions (EIFEL), scientific research and experimental development (SR&ED) incentives, Canadian-controlled private corporations (CCPC) rules, capital gains deferrals and exemptions, and new reporting requirements for certain trusts and non-profits. Draft legislation was also released for the Global Minimum Tax Act, the Excise Tax Act, and technical Income Tax Act amendments.
Czech Republic
- The Senate has approved an amendment to the Act on top-up taxes, extending first-time filing deadline. For the 2024 calendar year, the top-up tax information return is now due by 30 June 2026 (previously 31 October 2025), and the top-up tax return is due by 31 October 2026. The amendment is pending presidential signature before promulgation.
- On 25 August 2025, the Czech Ministry of Finance published details of MLI amendments to the Czech Republic–Germany tax treaty. Changes are made to the preamble, principal purpose test, and mutual agreement procedure. These changes will be effective as of 1 January 2026.
European Union
On 24 August, it was confirmed that Trinidad and Tobago is on track for removal from the EU tax blacklist by February 2026, after major transparency and reporting reforms.
Germany
On 8 August, the Ministry of Finance published draft amendments to the Minimum Tax Act to implement OECD Administrative Guidance from December 2023, May 2024, and January 2025, and to simplify certain anti-profit shifting rules.
India
The Tribunal recently ruled in favour of Sony India on several important transfer pricing matters. It confirmed that the Bright Line Test and the so-called intensity adjustment are not valid methods for assessing advertisement, marketing and promotion expenses, and therefore all such adjustments were deleted. The Tribunal also rejected the determination of a zero royalty, emphasizing that the Comparable Uncontrolled Price method must rely on actual comparable data and cannot question the commercial necessity of the payment. In addition, a functionally different company was excluded from the list of comparables, and the issue of interest on outstanding receivables was remanded for recalculation. The only point decided against Sony concerned its request for a lower Dividend Distribution Tax rate.
Ireland
- On 31 July, Irish Revenue published updated guidance on the Pillar Two minimum taxation rules. The changes address insurance investment entities, intra-group financing, post-filing adjustments, transitional CbC safe harbour, mergers, and the treatment of joint ventures.
- On 15 August, Irish Revenue opened the online registration portal for Pillar Two. In-scope entities must register via the Revenue Online System within 12 months of their first applicable fiscal year (from 31 December 2023), even if no top-up tax is due. The first returns and payments are due by 30 June 2026, with a new filing system expected in early 2026.
Italy
- On 22 August 2025, the tax authorities clarified that the supply of a trademark and related intellectual property rights is treated as the supply of an asset, not as a transfer of going concern. The ruling reaffirms that for a transfer of going concern, transferred assets must be sufficient to allow an independent and lasting economic activity.
- On 25 August 2025, the tax authorities confirmed that transfer pricing adjustments are VAT-relevant when based on provisional supply prices. Adjustments must be linked to the original invoices with details of allocation and VAT treatment.
Korea
On 31 July, the Ministry of Economy and Finance announced the 2025 Tax Reform Proposal, featuring a 1% corporate tax rate increase, expanded R&D credits, a new domestic minimum top-up tax, and restored securities transaction tax rates. It is scheduled for submission to the National Assembly by 3 September 2025.
Malaysia
On 22 August, Malaysia published the English synthesized text of the Malaysia–UK Income Tax Treaty, reflecting modifications by the Multilateral Instrument (MLI).
Mauritius
On 9 August, the Finance Act 2025 introduced a 15% domestic minimum top-up tax for MNE groups under Pillar Two, effective from the year of assessment starting 1 July 2025.
Netherlands
On 14 August, the Netherlands signed the Multilateral Competent Authority (MCA) Agreement on the Exchange of GloBE Information under Pillar Two rules. These rules require annual filing of a GloBE Information Return, and the MCA Agreement facilitates the automatic exchange of GloBE information with relevant jurisdictions.
OECD
- On 6 August, the OECD published a list of jurisdictions that have signed the Multilateral Competent Authority Agreement on the Exchange of GloBE Information under Pillar Two. The agreement sets conditions for the automatic exchange of GloBE Information Returns.
- On 18 August, the OECD released an updated central record for the Pillar Two transitional peer review, listing jurisdictions granted transitional qualified status for implementing the domestic minimum top-up tax and income inclusion rule.
Spain
On 15 July (published 29 August), the Supreme Court ruled on a cash pooling case involving a Spanish subsidiary and a Dutch cash pool leader. The tax authorities had challenged asymmetrical interest rates and the use of entity-specific credit ratings. The Court confirmed that symmetrical rates must apply to both lending and borrowing, the group’s overall credit rating should be used, and the cash pool leader should only be remunerated for its limited administrative role. It should be noted that this is not intended to be general in nature but applies in view of the documentation analysed and after carrying out the necessary functional analysis.
Switzerland
- On 1 August, Switzerland updated its list of jurisdictions for the exchange of Country-by-Country reports, adding Tunisia with effect from 1 January 2024. This update supplements earlier lists from March, April, and June 2025.
- On 28 August, Switzerland signed the Multilateral Competent Authority (MCA) Agreement on the Exchange of GloBE Information under Pillar Two rules. These rules require annual filing of a GloBE Information Return, and the MCA Agreement facilitates the automatic exchange of GloBE information with relevant jurisdictions.
United Kingdom
- On 5 August, HMRC issued guidance on the domestic top-up taxes, covering scope, safe harbours, effective tax rate and liability calculations, entity treatment, and administrative rules under Pillar Two.
- On 28 August, HMRC published the English synthesized text of the UK–Latvia tax treaty, showing the MLI modifications.
Zambia
- On 20 August, the Supreme Court ruled in ZRA v. Nestlé Zambia Limited. Nestlé had been audited for 2010–2014, reclassified as a low-risk distributor, and assessed ZMW 13.8 million in additional tax. The Court upheld the assessment, confirming the use of the Transactional Net Margin Method, allowing emerging-market comparables, permitting aggregation, and placing the burden of proof on the taxpayer.
Final words
Thank you for taking the time to read this edition of our newsletter. I hope you found the insights and updates valuable. Do you have any questions or need further information? Contact us today to get expert advice on worldwide transfer pricing matters and developments.
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Best regards,
Adriaan van der Heijden
Director at Quantera Global
