June 7 2019
Mandatory transfer pricing documentation and bill implementing EU Tax Dispute Directive – voted by parliament
On 5 June 2019, the parliament voted at first reading amendments to the Tax and Social Security Procedure Code, as follows:
- the introduction of mandatory transfer pricing documentation requirements; and
- implementation of the EU Tax Dispute Resolution Directive (2017/1852) of 10 October 2017 on tax dispute resolution mechanisms in the European Union.
- the threshold for preparing mandatory transfer pricing documentation on loan transactions has been lowered to amounts of BGN 1 million (BGN 2 million in the initial proposal) or interest payments exceeding BGN 50,000 (BGN 100,000 suggested initially);
- the thresholds for a number of different transactions (e.g. goods, services, intangibles, loans) will be determined for each controlled transaction; only in specific cases, the transactions will be bundled (the initial proposal suggested that thresholds be calculated for each category of transaction with all related parties); and
- the first period for which transfer pricing documentation must be prepared will be 2020 (the initial proposal suggested that the first period be 2019).