Additional requirements for Dutch transfer pricing regulations

The Dutch government has introduced additional transfer pricing requirements in the Dutch Corporate Income Tax Act. In this article you find more information about these new requirements.

Key characteristics

Key characteristics of the legislation regarding the additional transfer pricing documentation are:

  • Additional transfer pricing documentation requirements are introduced for Dutch tax resident group entities which are part of an international group that has a consolidated turnover of at least € 50 million.
  • The additional documentation requirements include the obligation to include a master file and a local file in the administration of the Dutch group entity. Not fulfilling this obligation may lead to penalties.
  • An annual country-by-country report of where revenues, profits, retained earnings, employees, and tangible assets are located and where taxes are paid and accrued for companies with a consolidated turnover of at least € 750 million.

The legislation is applicable as of the fiscal year 2016 and is based on the OECD Transfer Pricing guidelines.

A short overview of the additional transfer pricing documentation:


Master file

The requirements to prepare a master file and local file will apply to Dutch tax resident entities of a multinational enterprise (MNE) group that has a consolidated group turnover equal to or exceeding EUR 50 million in the fiscal year preceding the year for which the tax return applies. These files should be included in the records of the taxpayer within the term set for submitting its corporate income tax return.

For smaller groups, the already existing Dutch TP documentation requirements under Article 8b(3) CITA 1969 will remain applicable in order to avoid imposing burdensome administrative requirements for small and medium-sized enterprises.

The master file should provide an overview of the MNE group business, including the nature of its global business operations, its overall transfer pricing policies, and its global allocation of income and economic activity in order to assist tax administrations in evaluating the presence of significant transfer pricing risk.

In general, the master file is intended to provide a high-level overview in order to place the MNE group’s transfer pricing practices in their global economic, legal, financial and tax context. The information required in the master file contains relevant information that can be grouped into five categories:

  • Organizational structure
  • Description of MNE’s business(es)
  • MNE’s intangibles
  • MNE’s intercompany financial activities
  • MNE’s financial and tax positions

Dutch transfer pricing regulations tax


Local file

The requirements to prepare a local file are equal to the requirements for the master file. The local file provides more detailed information relating to specific intercompany transactions. The local file focuses on information relevant to the transfer pricing analysis related to transactions taking place between a local country affiliate and associated enterprises in different countries and which are material in the context of the local country’s tax system.

The information required in the local file contains relevant information that can be grouped into three categories:

  • Local entity
  • Controlled transactions
  • Financial information

Country-by-country reporting

The requirement to prepare a country-by-country report (hereinafter: CbC report) is applicable to Dutch tax resident entities, members of an MNE group, with a consolidated group turnover equal to or exceeding € 750 million in the fiscal year preceding the fiscal year to which the CbC report applies.

The default rule is that if the ultimate parent company of a group with a consolidated group turnover equal to or exceeding € 750 million is a Dutch tax resident, the entity must provide a CbC report to the tax inspector within 12 months of the last day of the fiscal year.

A Dutch tax resident entity that is not the ultimate parent company of a qualifying multinational would need to file a CbC report in the Netherlands when:

  • The country in which the ultimate parent entity is a tax resident has not established CbC reporting obligations;
  • The country in which the ultimate parent is a tax resident does not have a signed agreement in place for automatic information exchange with the Netherlands on CbC reports at the latest, 12 months after the last day of the fiscal year; or
  • The inspector has informed the group entity that the country in which the ultimate parent company is a tax resident has systematically failed to comply.

Provided certain conditions are met, a group entity is not required to provide the tax inspector with a CbC report within 12 months after the last day of the fiscal year of the MNE group if a “surrogate parent entity” provides the CbC report to the tax administration of the country in which it is tax resident.


Taken into account that also the documentation penalties have been increased, it is important to take a good notice of these new additional regulations and update your transfer pricing files.