Key requirements and considerations

As of 1 January 2024, Malta introduced Transfer Pricing Rules (the Rules) that impose specific documentation obligations on entities engaged in related-party transactions within the scope of the Rules.  

The financial year 2024 marks the first year in which Maltese taxpayers are required to prepare and maintain Transfer Pricing (TP) documentation in compliance with these new regulations. 

Overview of the Transfer Pricing documentation requirements 

The Rules mandate that taxpayers prepare and retain documentation evidencing that their related-party transactions have been conducted in accordance with the arm's-length principle and the relevant provisions of the Rules. Documentation must clearly articulate how functions, assets, and risks are allocated among related parties for each transaction. 

What documentation is required?

In line with the Maltese TP Guidelines, TP documentation must be prepared in a timely manner and should comply with Chapter V of the OECD TP Guidelines. This entails the preparation of:

For multinational groups already operating in jurisdictions with TP documentation requirements, a Master File may already be in place. However, for Maltese entities within the scope of the Rules, the financial year 2024 may be the first in which a Local File must be prepared. 

Timing and accessibility of documentation

While there is no obligation to submit TP documentation annually, the Rules require that the documentation be readily available for inspection by the Malta Tax and Customs Administration (MTCA) upon request. 

It is recommended that entities finalise their TP documentation by the time they file their self-assessment tax return to facilitate compliance.

Document retention period

TP documentation forms part of a taxpayer’s record-keeping obligations under Article 19(1) of the Income Tax Management Act. Documents must be retained for a minimum period of nine years, starting from the later of:

How can we help?

Preparing comprehensive and compliant documentation can be complex, requiring detailed analysis of business functions, financial data, and applicable regulations. Given these challenges, PwC Malta’s TP team offers specialised expertise to guide organisations through the documentation process efficiently and effectively, ensuring accuracy and compliance with Maltese and international standards.

Our team offers tailored support in:

At PwC Malta we can help you ensure your TP documentation complies with regulatory requirements, minimises the risk of audit challenges, and strengthens your business’s compliance framework and operational effectiveness.