Highest Signings in any FY: CBDT Signs 95 Advance Pricing Agreements in 2022-23
Highest Signings – Financial Year – CBDT – FY – Advance Pricing Agreements – APAs – taxscan
Highest Signings – Financial Year – CBDT – FY – Advance Pricing Agreements – APAs – taxscan
In this Financial Year, the Central Board of Direct Taxes (CBDT) has signed the most Advance Pricing Agreements (APAs) . A total of 95 APAs with taxpayers were signed for the Financial Year 2022–23. With a total of 21 APAs signed on March 24, 2023, a record for the greatest number of APAs signed in a single day in the programme's history was also established.
The APAs consist of 32 Bilateral APAs and 63 Unilateral APAs (UAPAs) (BAPAs). This brings the overall number of APAs since the APA program's start to 516, which includes 420 UAPAs and 96 BAPAs.
Advance Pricing Agreements (APAs) are contracts that tax authorities and taxpayers enter into to create a transfer pricing mechanism for a series of transactions involving related parties.
Getting involved in an APA has a variety of benefits. An APA can give the taxpayer more assurance when it comes to tax planning and lessen the chance of a transfer pricing dispute, which can be expensive and time-consuming.
Also, as per the reports, the CBDT has signed the highest BAPAs this year. The Mutual Agreements with India's treaty partners, notably Finland, the UK, the US, Denmark, Singapore, and Japan, led to the signing of the BAPAs.
According to the release of the CBDT, the APA Scheme aims to give taxpayers clarity in the area of transfer pricing by defining the pricing methodologies and forecasting the arm's length price of global transactions for up to five years in the future.
Additionally, the taxpayer has the choice to reverse the APA for the four years prior, providing nine years of tax certainty. The taxpayers are additionally shielded from any potential or real double taxation by the signing of bilateral APAs.
The Government of India's objective to promote ease of doing business has benefited greatly from the APA programme, especially for Multinational Companies (MNEs) that conduct numerous cross-border transactions among the members of their group.
To Read the full text of the Press Release CLICK HERE
Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
