Transfer Pricing Policy Below Threshold In Egypt

Transfer Pricing Policy Below Threshold in Egypt ensures arm’s length compliance even when transactions fall below documentation thresholds. In Egypt, transfer pricing is no longer seen solely as a documentation requirement for large groups; it has become a broader matter concerning tax compliance and risk management, applying whenever a taxpayer enters into commercial or financial transactions with related parties. Although the formal obligation to prepare and submit the Local File and Master File is generally linked to reaching the statutory materiality threshold, the arm’s length principle remains applicable even where transaction values fall below that threshold. Article 30 of the Egyptian Income Tax Law authorizes the Egyptian Tax Authority (ETA) to verify whether transactions between related parties have been conducted at arm’s length, and, where necessary, to restate taxable profits accordingly.