Global Daily Tax News, South Africa Clarifies Customs Rules Following TP Adjustments, (Jan 25, 2024)

The South African Revenue Service is seeking feedback on draft rule amendments that are intended to clarify the rules regarding the revaluation of imported goods following a transfer pricing adjustment.

Specifically, the updated rules provide that multinationals must adjust a bill of entry to correct the customs value of goods in the case of a transfer pricing adjustment, as defined in the OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations.

SARS said: "The rule amendments under the Customs and Excise Act, 1964, (Act No. 91 of 1964) will provide clarity and certainty for multinational enterprises on how to account for their transfer pricing adjustments on previous customs declarations. This will ensure that they are compliant with their Customs obligations."

"Price fluctuations of goods and services delivered by multinationals have a knock-on effect and impact the profits and, as a result, the tax liability of the multinationals. It is then the obligation of the multinational to adjust the transfer pricing payment retrospectively to ensure compliance."