The Romanian Tax Administration (ANAF, in original) has just sent to the local press a few data regarding the activity in the area of transfer pricing during 2014.

Here are the main information:
• In 2014, the tax inspectors conducted 130 tax inspections "which included an analysis of the affiliation relations of the taxpayer and the transfer prices applied as part of the transactions undertaken with the identified related parties";
• "Last year were conducted a third of the total number of transfer pricing inspections performed until present, and the biggest transfer pricing adjustment performed by the tax inspectors was 18% higher than the one performed in 2013. The adjustment was performed to a large taxpayer not named by ANAF";
• ANAF mentions that the team allocated for managing the area of transfer pricing consists of 54 tax inspectors at a local level and 12 tax inspectors at the central level. Until present, 72 tax inspectors were trained as part of an experience exchange program with experts from UK, and 196 tax inspectors operating in the territory participated in 2014 in intensive training seminars in the area of transfer pricing. According to an official note from 2014, all tax inspectors within the tax inspection apparatus of NAFA have attributions in auditing transfer prices, by way of requesting the transfer pricing documentation file.

 This should be read in the context in which public opinion begins to put pressure on the tax authorities to show "spectacular" results through auditing large taxpayers, not only the small ones.

Actually, comparing with the previously ANAF data (please find below), 2014 is the year with the most audits on transfer pricing by far.

• During the 2010 – 2013 period, there were 402 audits requiring the transfer pricing documentation file.

• Compared to the 2010 – 2012 period, the audits from 2013 represent roughly 15% of the tax audits in which the supervisory body ordered the elaboration of the transfer pricing documentation file.
• In 2013, the maximal transfer pricing adjustment was performed with about 72% higher than the adjustment made in the previous year, 2012.
• The amount of the additional amounts (income tax, penalties and late payment penalties) is around RON 48 million, in 2010 – 2013.
• Regarding the reference period, the fiscal loss of the audited taxpayers (including the transfer pricing documentation file) has been reduced by about RON 450 million.
• All tax inspectors of the ANAF tax inspection apparatus are responsible for examining the transfer pricing documentation file by requesting it.

By their specific of not being an exact science, transfer prices are thus a major tax risk for groups of companies.
In the next issue of our newsletter, TPS Express, we will return with fresh information to help you maintain your Transfer Pricing Safety.