Local Report – Transfer Pricing

December 27, 2023

The efficient management of tax resources is essential for the efficient operation of any country. Hence, the Local Report – Peru arises as an essential tool, according to the Tax Administration, playing a fundamental role in gathering economic information affecting the decision-making process and the auditing of taxpayers performing related-party transactions directly, mainly in large economic groups. In this regard, the Transfer Pricing regulations are established as normative standards to ensure appropriate tax control and avoid tax base erosion of taxpayers performing transactions with related parties and/or companies residing in preferential tax regime territories.


The Local Report is an indispensable mechanism for SUNAT to provide a detailed and updated overview of the economic transactions performed in a specific jurisdiction. The information gathered through this report enables tax authorities to evaluate the tax compliance of companies and individuals, identify possible irregularities, and design strategies to optimize tax collection. Likewise, it significantly contributes to tax transparency and equity in the distribution of the tax burden.

In this regard, the significance of filing the Local Report is to ensure consistency and fairness in Transfer Pricing practices internationally through regulatory compliance, risk management, and optimization of the tax burden in transactions among related companies and/or companies residing in preferential tax regime territories.

The access to this information by Tax Administrations ensures taxpayers comply with their tax obligations fairly in the Transfer Pricing context, avoiding possible loopholes and ensuring the sustainability of public resources.


These are closely aligned with the general goals of the Tax Administration.

First, a detailed overview of the local economic activity must be obtained, including data on revenues, expenditures, investments, and other relevant transactions. This information is essential for assessing the contributing capacity of residents and companies in a specific jurisdiction.

Second, the identification and correction of possible tax evasion must be facilitated, i.e., tax authorities can employ it as an early detection tool, investigating and addressing irregularities before these become more complex problems.


Its implementation is not free of challenges and risks. One of the main risks lies in the confidentiality of the gathered information. The Tax Administration must ensure that sensitive data is securely handled and protected against threatening leaks for the privacy of taxpayers.

Likewise, the Tax Administrations establish penalties and fines to prevent non-compliance with these obligations, which vary based on the jurisdiction and tax laws applicable in each country. Non-compliance, late filing, or error in the information declared are subject to both penalties and tax adjustments to transactions in which the agreed prices do not respect normal market conditions.