ZAMBIA Law and Practice Contributed by: Mulenga Chiteba, Constance Namatai Mwango and Bwalya Milunga, Mulenga Mundashi Legal Practitioners
within 30 days of the date of said service object to the assessment by way of written statement addressed to the Commissioner-General of the ZRA, setting out the grounds of objection. If the taxpayer is dissatisfied with the outcome of the Commissioner-General’s decision concerning the objection to the assessment, the taxpayer may, within 30 days of the date of being served written notice of this decision, appeal against the assessment to the Tax Appeals Tribunal (the “Tribunal” ). Taxpayers must retain documents and records relating to transfer pricing for ten years from the date of the last entry in those documents and records. The documentation must contain infor - mation that verifies that the conditions in a tax - payer’s controlled transactions for the relevant tax year are consistent with the arm’s length principle. The documentation must reflect the following: • the controlled transactions, including the nature, terms and price of each controlled transaction, details of property transferred, or services provided, and the quantum and value of each respective transaction; • the identity of associated persons involved and the relationship between the associated persons; • a detailed comparability analysis of the person and associated person with respect to each documented category of controlled transaction, including the functions per - formed, risks, borne tangible and intangible assets used, and any changes made com - pared to prior years; • details of other controlled transactions that directly or indirectly affect the pricing of the subject controlled transaction; • records of the economic forecasts, budgets or other financial estimates prepared by the
person for that person’s business or sepa - rately for each division or product that may have a bearing on a controlled transaction; • uncontrolled transactions and information on financial indicators for unrelated parties relied on in the transfer pricing analysis, including a description of the comparable search meth - odology, and a record of the nature, terms and conditions relating to any uncontrolled transaction with unrelated parties relied upon in the transfer pricing analysis; • the details of any comparability adjustments performed, indicating whether they have been performed on the tested party or on the com - parable uncontrolled transaction, or both; • the transfer pricing methods considered in determining the arm’s length price in relation to each transaction or class of transaction, the method selected as the most appropriate method, why that method was selected, and how that method in each controlled transac - tion; • which associated person is selected as the tested party, and an explanation for the choice of the tested party; • a summary of financial information used, and the assumptions made in applying the trans - fer pricing methodology; • the reasons for performing a multi-year analy - sis, where applicable; • the assumptions, policies and price negotia - tions, if any, which have critically affected the determination of the arm’s length price; • details of the adjustments, if any, made to the transfer price to align it with the arm’s length price, and consequent adjustments made to the total income for tax purposes; • the reasons for concluding that the controlled transactions were conducted on an arm’s length basis, based on the application of the selected transfer pricing method;
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