The UK gained £1,137 (USD 1.7 billion) by successfully challenging multinational transfer pricing in fiscal year 2013–14, according to statistics released by HM Revenue and Customs on March 6.
The goverment collected twice as much tax from transfer pricing challenges in FY 2013–14 as compared to the previous year, but not the most tax ever. In FY 2008–2009 the transfer pricing yield was £1,595 (USD 2.4 billion).
UK Financial Secretary to the Treasury David Gauke said the tax collections were the result an approach, adopted by HMRC in 2008, which includes using a specialist team for transfer pricing matters and focusing on high risk cases.
Since adopting this new approach in 2008, the government has secured £5.8 billion (USD 8.7 billion) in additional tax, according to government statistics.
HMRC also said it signed 29 advance pricing agreements (APAs) in FY 2013–14, an amount which is in-line with previous years’ output.
Average time to complete an APA in FY 2013–14 was the longest of the five fiscal years recorded, though, totaling 27.8 months.
The average time to resolve a mutual agreement procedure (MAP) case was also the highest recorded in five years. It took 29 months to resolve the 46 MAP cases that were resolved FY 2013–14, whereas in prior years, average time to resolve MAP cases ranged from 21 months to 27 months.
The agency also saw a jump in the number of new MAP cases added in FY 2013–14. There were 61 new MAP cases admitted, as compared to 39 to 51 new cases admitted in earlier periods.
Also, 198 advance thin capitalization agreements were signed in FY 2013–14, the most signed in the last four fiscal years, bringing the total agreements in force to 510.
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