Transfer Pricing



Transfer Pricing Cyprus: More than risk management

Commercially, a business can adapt its pricing policies to meet both the legal and economic requirements in its country of operation. Operationally, a restructure can improve efficiencies and drive business performance. Taxand’s global team of dedicated experts helps you to approach transfer pricing and business restructuring not merely as a matter of risk management but also as a highly effective international tax planning tool, supporting documentation requirements, effecting business restructuring arrangements, and supply chain value creation.

Increasing efficiency, reducing your tax rates

Good transfer pricing policies and restructuring arrangements can help increase efficiency and reduce effective tax rates. At Taxand we remain continually apprised of the latest transfer pricing regulations, business restructuring arrangements, supply chain value creation, intangible asset valuation techniques, and routinely carry out robust economic analyses to support pricing policies and maintain strong, productive relationships with local tax authorities. Moreover, we maintain deep knowledge of advanced transfer pricing optimisation and business restructuringapproaches—and adapt those approaches to meet real-world business constraints.

We recognise that for international business restructurings, transfer pricing is a core component to ensure that a robust and substantive business model is implemented. In addition to offering core transfer pricing and business restructuring services, Taxand offers specialist traditional transfer pricing expertise as well.

Whether you are establishing centralised functions, reshaping operational flows; require support to satisfy documentation requirements in multiple jurisdictions or assistance with advance pricing agreements; tax advice associated with intangible asset valuations, business restructuring or dispute resolution, Taxand has the capacity, experience and knowledge to meet your needs. View Taxand's Transfer Pricing Advisors in Cyprus

Transfer Pricing Cyprus Services

Global design and value chain optimisation services
• Risk management
• Intellectual property tax management
• Global Restructuring
• Tax leakage minimisation

Tax optimised valuation services
• Intangible assets valuation
• Assessment of arm’s length royalty rates

Dispute resolution services
• Audit support
• Negotiation of mutual agreements and arbitration procedures
• Expert testimony

Advance pricing agreement services
• Unilateral bilateral and multilateral Advance Pricing Agreements
• Negotiation with relevant tax authorities

Documentation services
• Global, regional and local documentation
• Transfer pricing documentation related to goods, services and intangibles
• Economic analyses including benchmarking studies
• Reconciling actual transfer pricing position and defensive policies

Our Experience

UK/Cyprus: Global Fund Manager (EUR 3bn)

Advising on transfer pricing of the intra-group transactions of the fund companies, and advising on the new risk analysis framework – six step process following BEPS Actions 8-10 for identifying and analysing risks.

UK: Treasury company investing in distressed debt, for a large UK Pension Fund (GBP 7bn)

Transfer pricing evaluation of the interest and gain components related to distressed debt of intermediary financing companies, including the credit evaluation and expected recovery rates of the borrowers.

Cyprus: Trading Platform Valuation (EUR 300m)

Prepared a valuation for the transfer of software for a trading platform and obtained tax rulings in Cyprus regarding the IP regime, and abroad securing tax certainty regarding royalty rates applied.

Asia: Restructuring for Luxury products multinational (>EUR 10bn)

Designed a new transfer pricing global policy for a large Asian multinational operating in the retail business of luxury products, preparing documentation and negotiating various APAs in various countries.

Israel: Valuation of intangibles for an Entertainment and Gaming Group (EUR 100m)

Valuation of various marketing intangibles being sold, in relation to products in the entertainment and gaming industry.

US: Intra-group financing for R&D activities of a major US technology multinational (USD 2.5bn)

Providing transfer pricing advice on structuring various financial instruments through Cyprus, granted from the US ultimately to European subsidiaries of a US technology multinational. The subsidiaries were engaged in “blue sky” (high risk) research and development activities.

Luxembourg / Singapore / Cyprus: Treasury company of major real estate fund (EUR 1.5bn)

Advised on setting-up full-fledged treasury companies in Luxembourg and Singapore of a Cyprus-based regulated fund, investing in Asian and European real estate.

Eastern Europe: TP litigation support for Original Equipment Manufacturer (OEM) (EUR 400m)

Developed a transfer pricing model to map, in particular, key functions and intangibles explaining the group’s profit allocation, successfully employed in the context of tax litigation for a OEM operating in Eastern Europe.

Netherlands / Belgium: Transfer of portfolio of loans from a Private Bank provided to online entertainment start-ups (EUR 3bn)

Advised on the transfer of a large portfolio of intra-group loan receivables from Belgium to the Netherlands, and negotiated an APA with the Dutch tax authorities. The loans had been granted to online gaming and online casinos start-ups, and the project included a valuation of the gain realised upon the transfer of the portfolio of loans.

LATAM: Parent guarantees to issue bonds to the market to acquire a pharma Company in LATAM (USD 2bn)

Advised on the transfer pricing aspects of parent company financial guarantees, including an element of performance guarantee, to issue bonds to the market and use the proceeds to acquire a LATAM pharmaceutical.


Gaspar Lopes Dias | Partner at Taxand Cyprus

Gaspar specialises in transfer pricing and international taxation, having experience in a broad range of transfer pricing matters including financial operations, business reorganisations and IP structuring, advising multinationals in various industries and investment funds. Gaspar joined Taxand Cyprus from the tax practice of Baker & McKenzie in London, having previously worked at Loyens & Loeff in Luxembourg, and KPMG Belgium. LL.B civil law (Nova University Lisbon), LL.M International Tax (Tilburg University), MSc Taxation (University of Oxford), ADIT, UK CIOT, IFA member (UK Branch).

Demis Ioannou | Tax Partner at Taxand Cyprus

Demis specialises in corporate income tax law, transfer pricing and international tax (treaty) law. He has a strong track record with clients in advising on transfer pricing issues and in complex corporate tax law issues. His extensive interest in comparative income tax law (US, UK, Canada and Australia) offers him a unique advantage in solving complex tax issues in Cyprus.

Demis received his Master of Laws (MSc) in Tax Law from Oxford University. He was trained from a Big4 company and holds a first-class Bachelor’s degree in Accounting and Finance from the UK, as well as being a qualified Chartered Accountant in England & Wales. He is currently an LLB candidate (final year) at Frederick University Cyprus.

Demis’ dissertation in Oxford focuses on analysing the OECD BEPS Project and was supervised by Richard Collier, a senior tax advisor of the OECD on transfer pricing issues. In addition, he published a paper for the Cambridge Tax Law History Conference edited by Professor Peter Harris (University of Cambridge) on income tax fundamentals and the origins of the Cypriot income tax law. Demis is a co-representative for IFA (YIN) in Cyprus.

Transfer Pricing Advisors in Cyprus

Christos Theophilou | Tax Partner at Taxand Cyprus

Christos specialises in private clients and corporate tax issues (including transfer pricing) with an international dimension, such as private equity structuring, cross-border investments, structured finance, IP structuring and international trade.

Christos received his Master of Laws (MSc) in Tax Law from Oxford University. He was trained from a Big4 company and holds a Bachelor’s degree in Economics, the Advanced Diploma in International Taxation (ADIT) of the UK Chartered Institute of Taxation, as well as being a qualified Chartered Accountant in England & Wales. He is currently an LLB candidate (final year) at Frederick University Cyprus. Christos is a contributor to international tax publications such as IBFD, Tax Notes lnternational, Bloomberg ΒΝΑ, International Tax Review and IFA as a national reporter. Furthermore, Christos is currently a member of the Τax Policy and Strategy committee of lnstitute of Certified Public Accountants of Cyprus.

Christos is also a freelance lecturer for Τolley's (LexisNexis) in Greece, Cyprus and Ukraine, where his main areas are ADIT Paper 1 Principles of lnternational Tax. Christos is a well-known personality in the tax world, where he is a regular speaker at a wide range of conferences.

Costas Savva | Tax Partner at Taxand Cyprus

Costas has considerable experience in advising on international tax law and corporate tax issues. He focuses his practice on the tax aspects of inbound and outbound business operations with a strong track record in cross-border investment structures and structured finance. Costas also specialises in Transfer Pricing, with experience in a broad range of transfer pricing matters. He advises on financial transactions (e.g., cash pool, debt pricing) and intragroup services.

Costas holds an LL.B. from Frederick University and a Master of Laws (LL.M.) in International Taxation from the Vienna University of Economics and Business (WU) in Austria. He is a qualified fellow member of the Association of Certified Chartered Accountants (ACCA) and a member of the Institute of Certified Public Accountants of Cyprus (ICPAC). He was trained by KPMG Cyprus, where he later served as a senior manager at the Nicosia office.

Costas serves as the Cypriot correspondent of the IBFD holding regime. He is also the co-author of the book Limiting Base Erosion edited by Professor Michael Lang. He regularly publishes on a wide variety of tax topics.



Transfer Pricing News


1. When are the new Transfer Pricing documentation compliance obligations effective?
Effective as of o1 January 2022 and arm’s length principle may be applied and interpreted in accordance with the OECD Transfer Pricing Guidelines as amended from time to time.
2. Who is in-scope?
(1) Cyprus tax resident persons; and (2) permanent establishments of non-resident persons situated in Cyprus, engaged in “Controlled Transactions” (main rule of the law is when one legal entity participates in the share capital of another legal entity through the direct or indirect holding of share of at least 25%, the two parties are considered related parties).
3. What is-scope?
Filing obligations of the controlled transactions on an annual basis:
I. Cyprus Local File (submitted within 60 days upon request);
II. Master File (if relevant); and
III. Summary Information Table (submitted together with the tax return).
* Small size exemption applies when the controlled transactions cumulatively, per category (e.g. services, goods, financial transactions, do not exceed €750,000 per tax year.
4. Transfer pricing documentation compliance obligation deadlines?
The Transfer Pricing Study and the summary information table for a particular year should be prepared no later than the due date for submitting the taxpayer’s Income Tax Return for that year.
5. Transfer pricing documentation compliance obligation penalties?
• In the event of late submission of the summary information table, a five hundred euros (€500) fine is imposed.
• In case the documentation is not made available to the Tax Commissioner within 60 days from the notification of a request, a fine of five thousand euros (€5,000) is imposed,
• If it is not made available from the sixty-first (61st) day until the ninetieth (90th) day, a fine of ten thousand euros (€10,000) is imposed.
• If it is not made available at all or made available after the ninetieth (90th) day, a fine equal to twenty thousand euros (€20,000) is imposed.
6. Who is eligible to prepare a transfer pricing study?
A person who holds a Practicing Certificate from the Institute of Certified Public Accountants of Cyprus needs to perform a quality review of the Cyprus Local File noted above.
7. Does the new legislation provide for an Advance Pricing Agreement procedure?
Yes, and the Advance Pricing Agreement decision may be applicable for a maximum term of four years.

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