On 15 December 2015, SARS issued a draft Public Notice that sets
out the additional record-keeping requirements for transfer pricing
transactions.
It proposes extensive and comprehensive documentation
requirements that must now be kept by taxpayers with a consolidated
South African turnover of R1 billion or more.
Although this provides South African taxpayers with clarity on
the information that must be retained for transfer pricing
purposes, these requirements are fairly onerous and will increase
the compliance burden of these taxpayers, resulting in additional
costs.
The notice introduces the new term of "potentially affected
transactions" which refers to all cross border transactions
with the connected persons as listed in section 31, regardless of
whether the terms and conditions of such transaction are different
from the terms and conditions of an arm's length
transaction. In other words, where the focus on preparing a
transfer pricing policy is only on
