Taiwan clarifies transfer pricing documentation rules for companies that undergo merger, acquisition, accounting change

Taiwan’s government on April 1 clarified how multinational enterprises should compute transfer pricing documentation thresholds when they operate in Taiwan for less than a full year due to merger, acquisition, or change to fiscal year-end.

The National Taxation Bureau of the Northern Area, Ministry of Finance, noted that under Taiwan’s laws, multinationals with annual revenue over certain thresholds must disclose intercompany transactions and prepare transfer pricing documentation.

The government clarified that if an enterprise operates for less than a full year due to merger, acquisition, or changes to fiscal year-end, the company should convert revenue and intercompany transaction amounts into a full year by proportion to determine if the transfer pricing threshold is met.