More Transfer Pricing Requirements Could Be Headed for Kenya7th June 2022
Looks like more transfer pricing requirements could be on their way to Kenya as soon as July 1, 2022. Back in April, the country released the Finance Bill, 2022, which includes significant new transfer pricing proposals. Currently, taxpayers must prepare a local transfer pricing document and submit it within 30 days—if and only if, it’s requested. But under the Finance Bill, 2022, proposals, transfer pricing compliance will become a lot more burdensome for taxpayers.
Following OECD guidelines, the new bill proposes that taxpayers above a certain threshold (KES 95 billion or €759 million) file—not prepare—master and local files and a country-by-country report. Currently, Kenya doesn’t have deadlines on the local file submission—and it lacks penalties for failing to submit or late submissions—so if the bill passes, taxpayers are in for a big change: The bill proposes local and master files be filed within six months after the last day of the reporting financial year of the MNE group. File on time, because under the new bill, failure to comply will, in fact, lead to penalties.