New Transfer Pricing Rules As Of 1 January 2022

On Thursday, 30 June 2022 the Cyprus Parliament passed a law introducing detailed transfer pricing legislation, marking a new era in company taxation, with effect from 1 January 2022. The OECD Transfer Pricing Guidelines have been legislatively incorporated in Cyprus. This short article serves as an overview of the relevant highlights of the law.

1. Introduction

Transfer pricing is the way tax law allocates income to related companies and permanent establishments. Cyprus is one of the last countries in the EU to implement transfer pricing rules. Before the enactment of this law, the legal basis to address transfer pricing issues rested on the arm's length principle (ALP), as found