Are You Prepared for the New Transfer Pricing Rules in 2025?

Transfer pricing may sound like a complex tax topic, but it has become essential for Belgian companies that are part of an international group. If your company meets any of the following criteria*, you should pay extra attention: 

• Revenues of at least €50 million (excluding non-recurring revenues). 

• An average annual workforce of 100 FTEs. 

• A balance sheet total of €1 billion. 

 Additionally, companies within multinational groups with consolidated gross revenues of at least €750 million are facing additional obligations as they must also submit a country-by-country report or notification. 

 WHAT WILL CHANGE IN 2025? 

To improve transparency and data exchange, both within Belgium and internationally, the tax authorities have revised the transfer pricing documentation and requirements. These changes apply to fiscal years starting in January 2025. Below are the key modifications. 

Local File 

The biggest change? Starting in 2025, you must submit supporting documents for your transfer pricing policy, including: 

• Documentation on transfer pricing methodologies; 

• Benchmark studies; 

• Agreements/contracts. 

 Additionally, the form has been updated with the following changes: 

• Cross-border related transactions must now be broken down by country instead of being aggregated across all countries.  

• The tax identification number of major competitors must be included.  

• For cost contribution agreements, advance pricing agreements (APAs), and internal (re)insurance, you must explicitly report the country code and tax identification number of the involved entity. 

Master File 

Although the form itself remains unchanged, the tax authorities require more details, such as: 

• A comprehensive description of the value chain and functional analysis of the group. 

• An analysis of DEMPE functions for intangible assets. 

• Specific information on hard-to-value intangibles. 

• A detailed explanation of intra-group financing arrangements. 

 While these clarifications may seem logical, some go beyond what is requested by the OECD Transfer Pricing Guidelines. It is therefore wise to review your current Master File to ensure that all topics are covered in sufficient detail. 

Country-by-Country-Notification 

The CBC form will include an important update starting in 2025: you must indicate whether it is an initial notification, a modification, or the termination of the reporting obligation. 

WHAT DOES THIS MEAN FOR YOU? 

Tax authorities are becoming stricter, and controls will be more rigorous. Make sure your documentation complies with the new requirements. 

Stay ahead of the game and take action now to update your transfer pricing documentation and avoid unpleasant surprises. We are happy to assist you in any way possible. 

* Criteria are assessed based on the standalone BEGAAP financial statements for the penultimate closed financial year.