Reasons For Advance Pricing Agreement

6. The possibility of extending the provisions of an APA to a period ranging from the first day of the calendar year during which the subject first applied for an APA until the APA came into force if, after reviewing the first application, an APA was refused on the grounds that no agreement was reached between the tax authorities of a foreign counterpart. An APA provides a tool to avoid transfer pricing disputes. The experience of taxpayers and tax authorities with respect to pre-price agreements has shown that the best way to resolve complex transfer pricing issues for all parties is to cooperate before the problem becomes a problem. Finding a solution is usually more difficult. 2. Allow the subject to enter into a unilateral APA if the Russian and foreign tax authorities do not reach a mutual agreement after consideration of a draft APP. A preferential price agreement or preferential pricing agreement (APA) is an agreement between at least two states parties to a tax agreement. Pre-price agreements are negotiated by the competent authorities of each of the countries concerned.

A Pre-Pricing Agreement (APA) is an agreement between tax authorities and taxpayers on the future implementation of transfer pricing policies. An APA can be an effective measure to reduce transfer pricing risks for many tax payers, ensuring that the level of future profitability is accepted as appropriate by the tax authorities. In Finland, there is no specific legislation on the APP. Finland can enter into a pre-price agreement with the countries with which it has a tax treaty (a contract to avoid double taxation on income and capital income). An APP is based on the mutual agreement procedure provided for by the tax treaties between Finland and other states, which allows the abolition of international double taxation between contracting states. The mutual unification procedure is based on Article 25 of the model tax treaty published by the Organisation for Economic Co-operation and Development (OECD). 1. The list of grounds for refusing to enter into an APA has been expanded.

The following additional reasons were highlighted: the Apa negotiations require significant contributions from taxpayers and the relevant authorities. Therefore, the APA procedure is particularly appropriate in cases where the parties must agree on essential transfer pricing that can be interpreted.