The regulation of transfer pricing in Bolivia dates back to approximately 6 years ago, with the incorporation of Law No. 549 of July 21, 2014 or also known as the Investment Promotion Law and its regulations through Supreme Decree No. 2227.
But what are transfer prices? Transfer prices are those prices or considerations agreed in transactions between related parties, which must be according to market value.
However, in Bolivia, within the regulation of transfer pricing, certain formal obligations have been established, such as the presentation of an informative affidavit of transactions between related parties, as well as to have a Technical Study of Transfer Pricing.
The purpose of this article is to inform about the main aspects of these formal obligations and especially about Form N°601 that serves for the informative affidavit in this matter.
Formal Transfer Pricing Obligations
Subjects that carry out transactions between related parties in Bolivia must comply, according to Article 39 of Supreme Decree No. 22227, with having such transactions at market value, submit an informative affidavit of transactions between related parties and a Technical Study in order to support that such transactions comply with the principle of full competition.
Technical Study of Transfer Pricing
Taxpayers whose transactions with related parties, accumulated in an annual management, are equal to or greater than Bs 15,000,000 are obliged to submit this study.
In case the taxpayer carries out transactions with related parties for an accumulated amount lower than the indicated one, it should only have this Study with the verification of the market values, in order to be required later by the National Tax Service.
Transfer Pricing Information Affidavit
According to the article of the Board of Directors’ Normative Resolution N°10-0008-15, the taxpayers that comply with the following will be obliged to present this declaration:
- Carry out transactions between related parties in an accumulated manner, in an annual management, equal to or greater than Bs7,500,000.
Filing on form N°601
The informative affidavit of transactions between related parties-Form No. 601 is the means by which this formal obligation must be carried out.
The digital presentation of the Transfer Pricing Study -EPT, as well as the indicated Form must be sent within the term established for the presentation of the Affidavit and payment of the Corporate Income Tax (IUE).
To do so, the Da Vinci application must be used, which can be downloaded from the SIN page.
Structure of Form N°601
The indicated form has four modules called main, linked, operations and foot.
In the first one, the management or year to be declared is described, as well as the taxpayer’s identification data.
In the second section the taxpayer may register all the identification data of the related parties with whom he has performed transactions.
In the transactions section, the taxpayer will record commercial and/or financial transactions with the related party, for which purpose it will identify them by entry, exit, asset and liability transactions, detailing them.
Finally, in the foot section, the taxpayer will answer questions regarding transfer pricing, based on exports, reorganizations, imports, among others.
Fines for non-submission of the form
According to Article 162 of Law 2492 or “Bolivian Tax Code”, failure to comply with transfer pricing obligations carries a penalty, which will depend on the type of violation.
Likewise, Annex I of RND No. 10-0033-16 has established penalties ranging from 2500 UFV to 5000 UFV.
