ZAMBIA Law and Practice Contributed by: Mulenga Chiteba, Constance Namatai Mwango and Bwalya Milunga, Mulenga Mundashi Legal Practitioners
a manner consistent with the Guidelines, except where there is inconsistency. 11.4 Financial Transactions Zambia’s transfer pricing guidance aligns with the OECD Transfer Pricing Guidelines, except where inconsistent. The conduct of parties must align with reported accounts. Financial informa - tion must be provided by taxpayers, including: • annual local entity financial accounts; • allocation schedules; and • financial data for comparables. Further, financial documentation should be pro - duced in English. 12. Co-Ordination With Customs Valuation 12.1 Co-Ordination Requirements Between Transfer Pricing and Customs Valuation The Transfer Pricing Rules do not require co- ordination between transfer pricing and customs valuation; however, the ZRA has an integrated tax administration system called ASYCUDA (Automated System for Customs Data) which captures customs information and uses this as intelligence data in audits. 13. Controversy Process 13.1 Options and Requirements in Transfer Pricing Controversies Zambia’s domestic transfer pricing controversy process is as follows. Where the ZRA issues a notice of assessment following a transfer pricing audit and a taxpayer
is unhappy with this, the taxpayer can chal - lenge the assessment within 30 days of receiv - ing notice of it. This can be done by objecting to the results of the transfer pricing audit in the notice of assessment by way of writing to the Commissioner-General of the ZRA, setting out the taxpayer’s grounds of objection. If the Commissioner-General makes a determi - nation following the taxpayer’s objection, and the taxpayer is still dissatisfied with this, they have the right to appeal to the Tribunal within 30 days of receiving the Commissioner-General’s decision. The decision of the Tribunal will be enforced as if it were the decision of the High Court of Zambia. Where a decision made under Section 97A of the Income Tax Act is under appeal or pending before a court, the date of assessment will be deemed to be the date when a final decision relating to the appeal is made. The 30-day period to challenge such an assess - ment will only begin to run once the decision is made. It is important to note that all tax laws in Zambia, including the Transfer Pricing Rules, are based on the “pay now, argue later” rule of taxation. As such, no legislation contains any express provi - sion that empowers the Tribunal to grant a stay of execution to prevent the ZRA from collecting dispute tax in cases where there is an appeal lodged with the Tribunal. If either the ZRA or a taxpayer is aggrieved by the decision of the Tribunal, they have the right to appeal against the Tribunal’s decision to the Supreme Court of Zambia. The Supreme Court may determine the matter or refer it back to the Tribunal for re-hearing, confirmation, reduction, increment or annulment of the assessment or decision made by the Tribunal, and may make such further or other order on appeal, as to costs
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