Canada Completes 36 Advance Pricing Agreements in 2017

Canada Completes 36 Advance Pricing Agreements in 2017

Canada’s tax authority has completed 36 advance pricing agreements (APAs) in the 2017 calendar year, according to latest statistics published on the country’s APA program.

The APA program report, which was published on July 12 and covers the 2017 calendar year, reveals that, based on the number of pre-file meetings held with taxpayers in 2017, the Canada Revenue Agency (CRA) had 24 applicants to the APA program.

Accepted into the program were 16 new cases, three cases were withdrawn, and 36 cases were completed. This resulted in a closing inventory of 67 cases for 2017, the report notes.

Of all cases in process on December 31, 2017, 88 percent involve taxpayers seeking an APA on a bilateral or multilateral basis, as opposed to 12 percent of taxpayers seeking an APA on a unilateral basis, it adds.

During the review period, the CRA took an average time of 48.5 months to conclude a bilateral APA from acceptance into the APA program to completion. APAs involving the US represented 52 percent of APAs in process, the report states.

According to the report, cases involving transfers of tangible and intangible property comprised a majority of APAs in process (58 percent and 19 percent, respectively), while those involving intra-group services and financing represented 19 percent and four percent, respectively.

The transactional net margin method continued to be the most frequently employed transfer pricing methodology, the report notes.