Astra Interfax

The ASTER system is the solution for decrease in the tax risks connected with pricing at all stages of business process: financial planning of transactions, procurement procedures, tax control and reporting under controlled transactions.

2020

Start of service for the analysis of tax risks in cross-border transactions

On July 23, 2020 the Interfax company reported that it developed the module defining market intervals of profitability for transactions with the European interdependent companies to prove "market orientation" of these transactions in tax files.

According to the company, the module - a part of the ASTRA Interfax system, the Russian service for the automated preparation of documentation on controlled transactions.

Formation of lists of the comparable companies: model of selection

The module was developed for the Russian companies which should provide the reporting under controlled transactions, it considers the Russian specifics and contains financial data only concerning the checked companies which conform to requirements of the Tax Code of the Russian Federation. It allowed to create service which reduces tax risks. Artem Peregudov, the ASTRA project manager told

Final result of operation of the module are the calculated profitability intervals

Tax authorities when conducting checks regarding transfer pricing pay to cross-border transactions the main attention. According to the recommendations of the Organization for Economic Cooperation and Development (OECD) and requirements of the Tax Code of the Russian Federation, for justification of intra group transactions the method of comparable profitability can be used. The essence of a method consists in comparison of profitability of the analyzed transaction with the market interval of profitability received on the basis of data analysis of financial statements of the comparable companies. The ASTER will help when for justification of the controlled transaction it is necessary to define a market interval of profitability in the territory of the Russian Federation or the European Union.

If the tested party is registered in the territory of Europe, and in a single country there is no necessary number of the comparable companies, search of the comparable companies is performed consistently: at first in the analyzed country, then in the region (in Western or Eastern Europe), and - in all European Union.

As of July, 2020 all in Russia about 15 thousand companies annually hand over the reporting under controlled transactions.

Tasks, audience and features of the Aster system

(Data are relevant for 2020)

Tasks:

• observance of uniform methodology of pricing on the basis of market intervals (Russia/the EU)
• pricing of sales of goods / works / services, corresponding to the market, at a planning stage
• check of justification of the prices of the purchased goods, works or services
• justification of the transaction price with dependent and impartial persons
• justification of the prices of uncontrollable transactions and also lack of unreasonable tax benefit
• formation in the automated mode of a complete document package on transfer pricing (for controlled transactions)
• risk minimization of additional accruals when conducting checks from central office of FTS or territorial tax authorities

Audience:

• the companies with foreign participation working in Russia
• large commerce and industry holdings
• medium-sized companies which business is dispersed on regions of Russia
• the companies conducting foreign economic activity
• tax authorities
• consultants and auditors

Features:

• service is developed according to requirements of the Russian legislation
• work of service is tested by central office of FTS, territorial tax authorities, auditors and consultants who actively use service in the work
• service allows to keep the analysis of pricing in any types of transactions
• automatic preparation of the necessary reporting under controlled and uncontrollable transactions
• simple step-by-step algorithm of actions
• possibility of setup of a system under the user's tasks
• comprehensive support of the client
• opportunity for work of several users over one report