UK guidelines follow principles set out in the OECD guidelines.
a) Which transactions must be documented (all transactions with associated enterprises, or only those which exceed a particular threshold)?
Any provision between ‘connected persons’. The definition of ‘provision’ is broad, and represents a transaction or series of transactions including arrangements, understandings and mutual practices whether or not they are, or are intended to be, legally enforceable.
b) What is the definition of “associated enterprises” for the purposes of this requirement?
‘Connected persons’ are where one party controls the other, or where parties are under common control, with control generally meaning the power to secure by the means of holding of shares or the possession of voting or other powers that the affairs of a company are conducted in accordance with the wishes of the person tested. With effect from 1 April 2004 a 40% participant in a joint venture is also deemed to control that joint venture, a joint venture for these purposes being a company or partnership which is controlled by two persons, each of whom has at least a 40% interest in the venture.
c) For EU countries, is the content of the documentation similar to that described in the EU Code of Conduct on transfer pricing documentation for associated enterprises (“EU TPD”)? If not, are taxpayers entitled to choose between the local requirements and the EU TPD?
HMRC will accept documentation prepared in accordance with EUTPD guidelines. It is recommended that taxpayers who intend to explicitly follow the EUTPD Code of Conduct in relation to local documentation advise HMRC of this in writing.
d) Do taxpayers which are not established in your jurisdiction need to undertake to provide any specific information upon request? Can your tax authorities require the taxpayer in your jurisdiction to provide information which is located in another state?
Yes, to the extent that the foreign taxpayer is a counterparty to a transaction involving a UK legal entity, information relating to the foreign taxpayer may be requested from the UK party to substantiate the pricing of that transaction for UK tax purposes.
e) If comparable studies are to be provided, do the tax authorities generally accept regional benchmark studies (e.g. pan-European benchmark studies)?
Sometimes, if UK data is unavailable / limited.
f) What language(s) are to be used by taxpayers in submitting the transfer pricing documentation?