PERU Law and Practice Contributed by: Tania Quispe, Martín Ramos, Raquel Cabrera and Ramzi Benzaquen, +Value
• In light of Actions 6 and 14 related to avoid - ing the abuse of double taxation agreements (DTAs), the IPL incorporates in its negotia - tion models those indicated in these Actions in order to be more effective and to have a procedure for solving controversies arising from their application. Regarding this last point, the Tax Administration issued a guide for the taxpayer and other interested parties on MAPs that establishes the rules, guidelines and procedures according to the minimum standard required in Action 14. • In light of Action 10 related to the treatment of intra-group services, the Tax Administration has incorporated some proposals in its regu - lations for the purposes of testing the deduct - ibility of the expense. These can be found in Legislative Decree 1312. • Lastly, in light of Action 13 regarding formal obligations on transfer pricing, the ITL follows the three levels of documentation suggested by the OECD’s BEPS Project. This can also be found in the aforementioned Decree. 9.4 Impact of BEPS 2.0 Currently in Peru, Pillars 1 and 2 have not yet been considered as priority state policies by the Executive Branch or by the Legislative Branch. Therefore, at the present time there are no ini - tiatives linked to them. However, in the next few years, these Pillars will be developed, with greater emphasis on Pillar 2. 9.5 Entities Bearing the Risk of Another Entity’s Operations ITL legislation has not implemented a restriction regarding taxpayers assuming the operational risks of other entities to ensure a guaranteed return. In general, any transaction subject to transfer pricing rules must comply with the cor - rect allocation of market value, the application of the most appropriate method, the profit test
(if applicable), among other established obliga - tions. Assessing the variance in risk assumption is crucial for determining the level of comparabil - ity between controlled and uncontrolled transac - tions. 10. Relevance of the United Nations Practical Manual on Transfer Pricing 10.1 Impact of UN Practical Manual on Transfer Pricing The UN Practical Manual on Transfer Pricing for Developing Countries does impact transfer pricing matters in Peru. However, it is crucial to note that this impact is not exerted in a rigid manner but rather through training sessions in which SUNAT participates. An example of this is Peru’s engagement in the “Tax Inspec- tors Without Borders” (TIWB) initiative through SUNAT. This initiative is a collaboration between the OECD and the United Nations Development Programme (UNDP). 11. Safe Harbours or Other Unique Rules 11.1 Transfer Pricing Safe Harbours Peruvian regulations do not contain specific pro - visions on transfer pricing safe harbours. 11.2 Rules on Savings Arising From Operating in the Jurisdiction There are no specific rules governing savings that arise from operating in Peru. 11.3 Unique Transfer Pricing Rules or Practices Peruvian transfer pricing rules consider spe - cific provisions for the deduction of costs and
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