PERU Law and Practice Contributed by: Tania Quispe, Martín Ramos, Raquel Cabrera and Ramzi Benzaquen, +Value
7.7 Duration of APA Cover The ITLR stipulate that APAs shall be applicable to the taxable year in which they are approved and for the next three taxable years thereafter. 7.8 Retroactive Effect for APAs Peruvian legislation does not grant APAs ret - roactive effect. It should be noted that APAs contain a clause permitting their modification or annulment in instances where significant changes in a company’s operations or econom - ic circumstances severely affect the reliability of the methodology employed, in such a way that third parties would have deemed these changes significant for the determination of their prices. In this context, any modification or decision to annul the APAs will take effect from the taxable year in which the proposal for modification was submitted. In line with this, regarding the termination of APAs, the ITLR stipulate that SUNAT has the authority, under certain conditions, to unilater - ally invalidate these agreements. Nonetheless, transactions between related parties should be valued in accordance with the general provisions outlined in Article 32-A of the ITL, effective from the date the agreement is deemed null and void. 8. Penalties and Documentation 8.1 Transfer Pricing Penalties and Defences There are various specific penalties and fines for infractions related to transfer pricing, against which taxpayers may file appeals (if they disa - gree), within the established deadlines. Such infractions can be divided into the following three categories.
• Infractions related to the obligation of permit - ting oversight by the tax authority, reporting to, and appearing before it: for example, the infraction specified under numeral 27 of Article 177 of the Tax Code concerns not sub - mitting the documentation and information that supports the local file, master file, and/or CbCR as demanded in the specified manner, within the designated timeframe, and accord - ing to the required conditions. The defence strategy in this scenario is focused on proving that the taxpayer has complied with the tax authority’s documentation requests in accord - ance with the regulatory stipulations. • Infractions related to the obligation of filing declarations and communications: for exam - ple, the infraction identified in numeral 2 of Article 176 of the Tax Code pertains to the failure to submit reports within the prescribed deadlines. The defence strategy in this con - text is designed to establish that the tax - payer is not required to present said reports. Moreover, the infraction delineated in numeral 4 of Article 176 concerns the submission of reports either incompletely or inaccurately reflecting the truth. The defence strategy here aims to prove that the reports submitted comply fully with all prescribed guidelines and accurately depict the taxpayer’s operational realities. • Infractions related to the fulfilment of tax obli - gations: for example, the infraction specified in numeral 1 of Article 178 of the Tax Code relates to the declaration of false figures or data. The defence strategy in this scenario is aimed at clarifying that the reports have no bearing on the determination and pay - ment of the taxpayer’s tax liabilities. In Peru, there is a Graduated Penalty Relief System, through which taxpayers can obtain reduc - tions for the tax infractions they have com - mitted. For this purpose, each penalty and/
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