For many years, transfer pricing in Germany has been governed by various publications authored by the German Ministry of Finance, dating back as far as 1983. Due to significant developments initiated by the OECD and tax authorities, the Ministry of Finance has updated the German regulatory environment with changes to Article 3 of the German Foreign Tax Code and to two of the new administrative principles, “Transfer Pricing” (from 2021) and “2020.”

In their recently published International Tax Review article, NERA Economic Consulting Managing Director Dr. Yves Hervé and Principal Tom Braukmann discuss the changes to Germany’s transfer pricing regulatory environment, with a specific focus on future tax audits.

In “2021 German Administrative Principles: Impact on TP and Intangible Contributions,” the authors not only discuss the Ministry of Finance’s recent changes, but also explore:

• Significant changes for the documentation of intangible contributions;
• Implications for future tax audits; and
• Recommendations for taxpayers in Germany.