Transfer pricing implications of the global minimum tax

A key aspect of the global minimum tax rules and transfer pricing is to which parties and in relation to which transactions the transfer pricing requirements should be applied.

The transfer pricing concept of the global minimum tax applies to group members included in the accounting consolidation, while from the perspective of corporate tax, the transfer pricing rules basically apply to transactions between related companies. As a result, it is possible that a transaction carried out with a related company is subject to transfer pricing in corporate tax, but not in the case of the global minimum tax.

“Another fundamental difference is that in the context of corporate tax, transfer pricing rules must be applied to all related transactions – with some exceptions – whereas, according to the general rule of the global minimum tax, the arm’s length principle must only be taken into account in the case of cross-border transactions or loss-making domestic asset transfers”

– added Péter Gémesi, Director of Deloitte’s Tax Department.