Draft rule amendments on transfer pricing adjustments

SARS issued draft rule amendments for comment, providing more clarity for multi-national enterprises on accounting for their transfer pricing adjustments on previous Customs declarations. These amendments are designed to ensure that transfer pricing adjustments affecting the customs value of goods are properly reported to SARS, allowing for appropriate customs duty and VAT assessments and adjustments.

Rule 40.03 is being inserted after rule 40.02

• This rule pertains to the adjustment of bills of entry when the customs value of goods is affected by transfer pricing adjustments in accordance with the OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations.
• It states that when such adjustments are required under section 40(3)(a)(i), the bills of entry may be adjusted by following the process outlined in rule 41A.01.

41A.01 is being inserted after rule 41.05

• This rule deals with submitting notices regarding amended invoices or debit/credit notes when transfer pricing adjustments impact the customs value of goods.
• It defines key terms, including “transfer pricing adjustment” and “adjustment period.”
• It outlines the requirements for importers to disclose circumstances of transfer pricing adjustments to SARS within a specified timeframe.
• Importers can submit a notification letter via email to the designated SARS email address or by hand to any customs office.
• The letter of notification must be accompanied by various documents, including authorisation for submission by a representative, amended invoices or debit/credit notes, transfer pricing policy details, a spreadsheet reflecting affected bills of entry, and more.
• Additional requirements for documentation, such as purchase and sale agreements, financial statements, and other relevant records, are specified.
• Importers must also comply with any further instructions issued by SARS related to information submission, payment of duties and VAT, or claiming refunds.

Read the draft rule amendment here.

Your input matters! Email your comments on the draft rule to technical@myciba.org.