Advance Pricing Agreement
Finance
ministry approved the Advance Pricing
Agreement (APA) scheme, related to transfer
pricing regulations.
The
APA scheme, proposed in Budget 2012-13, is being considered as one of
the major industry-friendly initiatives.
The
finance ministry’s green signal to the provisions devised by the Central Board
of Direct Taxes (CBDT) would assist implementation of the APA scheme from July
1,2012. CBDT will release notification of the scheme, after taking approval of
the law ministry
The
scheme would cover the norms for coverage of cases under APA and also forms for
accessing the facilities offered. The applicant has to pay a fee of Rs 10 lakh
for international transactions not exceeding Rs 100 crore, Rs 15 lakh for transactions
up to Rs 200 crore and Rs 20 lakh for transactions above Rs 200 crore.
The
Budget introduced new sections in the I-T Act to provide a framework for APA.
It strengthened CBDT to enter into an advance pricing agreement with any person
undertaking an international transaction.
Advance Pricing Agreement
Advance
Pricing Agreement is an agreement inked b/w a taxpayer and a taxing authority
on an apt transfer pricing methodology for a set of transactions over a fixed period
of time in future. It offers better assurance on transfer pricing methods and
is friendly in providing certitude and unanimity of approach computer
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