Transfer pricing : the new deal

After the introduction of transfer pricing legislation in 1995, the South African tax authorities have started in 1999 with a campaign to actively enforce the application of this legislation. Basically the tax authorities have two approaches available: one is to send out questionnaires, follow-up questionnaires and negotiations; the other is to visit taxpayers offices and, where considered justified, imposing assessments without first engaging in negotiation. Obviously these actions have increased the attention of taxpayers for proper application of the transfer pricing legislation.