Preparing TP documentation
TP documentation is a special file prepared by the taxpayer and/or his consultants. Its purpose is to provide information necessary to identify TP risks and assess the taxpayer’s compliance with TP legislation. Much of the information usually included in the TP documentation is intended to describe the taxpayer’s business activities and the nature of related-party transactions.
The TP documentation shows that the taxpayer’s related-party transactions are arm’s length, and its findings may be used in handling any question or dispute with related parties, minority shareholders, or third-party beneficiaries.
Preparing a high-quality and timely TP documentation takes a longer time than one month, which the SRS usually allows the taxpayer when asking to see TP documentation.
