Belgium - Shifting gears towards transfer pricing audits

Tax Controversy & Dispute Resolution ()

In the last few days in Belgium, PwC has observed a large number of transfer pricing audits being initiated. The Belgian tax administration appears to be shifting gears on the transfer pricing front in order to raise revenues and prevent erosion of the tax base. Due to the lack of resources within the central group of experienced transfer pricing auditors, it has been decided to expand the team with regional tax inspectors in order to increase transfer pricing scrutiny.

Multiple taxpayers have recently received lengthy and in-depth questionnaires on their transfer pricing policy. It is in principle mandatory to reply to this request for information within one month. These questionnaires are sent out as the start of a thorough transfer pricing audit. It is expected that the number and detail of transfer pricing audits will increase dramatically over the next month and it will be of vital importance for taxpayers to proactively assess how well they are prepared for such audits.