Multinational enterprises (MNEs) should take time before the end of the 2023 calendar year to review and assess if their transfer pricing arrangements are producing arm’s-length prices and review other time-sensitive transfer pricing matters. As the 2023 calendar year represents the fiscal year-end for many MNEs, it’s a good opportunity to consider the evolving Canadian and global tax and transfer pricing landscape, and changing economic conditions that are expected to have an impact into 2024.
In particular, MNEs should take stock of the latest progress on many key global tax initiatives this past year. For example, the BEPS 2.0 Pillar Two global minimum tax rules will come into effect in 2024 in many countries, including Canada, the United Kingdom, Australia, Korea and some countries in the European Union. As part of the year-end review, MNEs should not only consider today’s transfer pricing and international tax implications, but also look at the potential for future ramifications.
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