Indirect Tax
EU adopts new legislation on electronic VAT Exemption Certificates
Excerpts from various sources
SIn February 2025, the European Council adopted a new legislative package to simplify tax procedures and reduce the administrative burden on businesses. The package revises the EU VAT Directive and the EU VAT Implementing Regulation, thereby replacing the current paper VAT exemption certificate with a digital version.
The new rules will be applied from 1 July 2026, giving adequate time to implement the new procedure. The electronic VAT exemption certificate will become mandatory from 30 June 2032. The European Commission will collaborate with Member States to ensure the seamless technical rollout of the new system.
Poland to implement E-Invoicing mandate from 2026
Excerpts from various sources
Poland is set to introduce new e-invoicing regulations in 2026, requiring businesses to transition to digital invoicing and enhanced compliance processes. The implementation will follow a phased approach, with larger taxpayers mandated to comply starting 1 February 2026.
Transfer Pricing
Australia introduces transfer pricing guidance for private groups receiving funding from foreign-related parties
The Australian Taxation Office (ATO) has released updated guidance for private groups receiving funding from overseas related parties, particularly in property and construction sectors. This guidance emphasizes compliance with transfer pricing rules to ensure funding arrangements adhere to the arm’s length principle. It highlights the need to demonstrate the commerciality of funding arrangements, ensuring proper documentation and avoiding risk factors such as excessive debt, insufficient equity, high interest rates on subordinated or unsecured loans, and prolonged loan durations. Businesses should justify their financing choices, maintain clear evidence of the arm’s length terms, and ensure accurate disclosure in their International Dealings Schedule.
Costa Rica Introduces Draft Resolution on Transfer Pricing Information Return Requirement
On 12 February 2025, Costa Rica’s General Directorate of Taxation published a notice in the official gazette announcing a draft resolution regarding the mandatory submission of annual transfer pricing information returns. The proposed resolution would require taxpayers conducting transactions with related parties, either domestically or internationally, which are considered as Large Taxpayers or beneficiaries of the Free Trade Zone Regime and that such operations, separately or jointly, exceed one thousand base salaries (CRC 462,200,000). These returns must be filed within three months after the fiscal year ends via the TRIBU-CR online system. However, for the 2024 fiscal period, the return must be filed within six months from the effective date of notice. Failure to comply may result in a penalty of up to 2% of the taxpayer’s gross income. Additionally, the notice establishes a standardized format and instructions for the return, replacing previous regulations.