Transfer Pricing in 2025: how can you prepare?

These developments have resulted in the implementation of more stringent and harmonized regulations concerning documentation requirements, aimed at preventing tax avoidance and enhancing transparency. At the same time, countries have further refined and expanded their national rules, resulting in a complex and dynamic regulatory landscape. As from 2025, transfer pricing regulations are further reinforced, both at international and national levels. Those who fail to prepare may face unexpected challenges during tax audits.

This article examines the transfer pricing documentation requirements in Belgium, the Netherlands, UK, Spain, Ireland and Germany. We discuss how these countries implement the OECD guidelines as well as the practical implications for multinational enterprises operating in these jurisdictions.

What are the transfer pricing documentation requirements in Belgium?

Since 2016, the Belgian transfer pricing documentation requirements have been structured around three pillars:

1. Master File Form (Form 275 MF)
2. Local File Form (Form 275 LF)
3. Country-by-Country Report (Form 275 CBC) and Country-by-Country Notification (Form 275 CBC NOT)

(For more information about the content and conditions per documentation pillar, reference is made to our Moore article.)

This structure will be maintained. However, starting from financial years beginning on or after 1 January 2025, the content requirements will be substantially more stringent. The focus of the tax administration will shift from a mere administrative filing to a comprehensive substantive framework that allows for better monitoring and assessment of cross-border transactions.

The Master File Form will need to include a detailed analysis of the value chain within the group, including the allocation of profit to individual entities based on value creation per primary function and a comparison with the transfer pricing results. The tax administration also expects a DEMPE analysis, which explains the DEMPE functions (Development, Enhancement, Maintenance, Protection, and Exploitation) in relation to intangible assets. Finally, a more detailed description of the transfer pricing policy for financial transactions must be included.

The scope of the Local File Form is also being extended. Companies will be required to report their intra-group transactions on a country-by-country basis. Furthermore, where available, the submission of the applied transfer pricing policy, the underlying economic analyses (such as benchmarking studies), and the corresponding model contracts or framework agreements will be mandatory.

Regarding the Country-by-Country reporting, the annual notification must explicitly indicate whether it concerns an initial notification, a modification, or a termination of the reporting obligation.

These changes highlight that transfer pricing is more than a formal obligation. It requires a substantive, robust, and coherent approach that can withstand international scrutiny and successfully pass local tax audits.

What are the transfer pricing documentation requirements in the Netherlands?

The Dutch transfer pricing documentation requirements are built around the following pillars:

1. Master File
2. Local File
3. 8b document
4. Country-by-Country Report and Country-by-Country Notification

(For more information about the content and conditions per documentation pillar, reference is made to our Moore article.)

Based on the consolidated revenues of the group, it is determined which documentation must be prepared. A distinction is made between entities with group revenues of up to EUR 50 million, those with group revenues exceeding EUR 50 million and those with group revenues exceeding EUR 750 million.

Developments within the OECD, as well as initiatives from the European Union, can have an impact on Dutch transfer pricing practices. Moore closely monitors international developments and informs you in a timely manner about relevant changes.

What are the transfer pricing documentation requirements in the UK?

1. Master File
2. Local File
3. Country-by-Country Report and Country-by-Country Notification

(For more information about the content and conditions per documentation pillar, reference is made to our Moore article.)

UK regulations are based on OECD Transfer Pricing Guidelines, requiring transaction between related parties to be conducted at arm’s length. The rules apply to multinational enterprises with UK operations, including UK permanent establishments of non-UK companies.

As of 1 April 2023, large businesses, groups meeting the Country-by-Country Reporting threshold (EUR 750 million revenue) must prepare a Master File and Local File following OECD standards to demonstrate their related party dealings are in line with the arm’s length standard. Currently, small and medium-sized entities are exempt from compliance requirements, however voluntary compliance is encouraged given that HMRC expects taxpayers to be able to substantiate the arm’s length nature of related party transactions. The SME thresholds are applied on a period-by-period basis and require entities to have fewer than 250 employees and either less than €50m in turnover or less than €43m in total assets all assessed at Group level. 

HMRC has published guidance on its expectations for documentation standards, most recently in the HMRC Transfer Pricing Guidelines for Compliance, which outline an approach to documentation and record keeping in order to manage tax penalty exposure.

HMRC is also currently running two sets of consultations for changes to the UK transfer pricing rules. The proposed changes will likely include the following:

• Remove UK-to-UK transfer pricing rules through specific exemptions.
• Expand the “participation condition”, broadening who is covered.
• Align treatment of loan guarantees and intangible assets with OECD standards.
• Restricting the SME exemption, bringing more medium-sized entities into scope.
• A new requirement for companies to prepare and file an “International Controlled Transactions Schedule”.

HMRC is expected to increase enforcement and penalties for non-compliance relating to transfer pricing. Businesses are advised to review functional analyses, define clear TP policies, and monitor outcomes regularly.

What are the transfer pricing documentation requirements in Spain?

1. Master File
2. Local File
3. Country-by-Country Report (Form 231 CbC) and Country-by-Country Notification (Prior notification - Form 231 CbC)

The obligation to prepare a Master File and a Local File applies to groups with consolidated revenues exceeding EUR 45 million, provided that the total amount of related-party transactions carried out by a Spanish company with any of its related entities exceeds EUR 250,000 within the same fiscal year.

Entities that do not reach the EUR 45 million threshold but exceed the EUR 250,000 limit are required to comply with a simplified documentation framework. 
It should be noted that the absence or inaccuracy of such documentation, once the EUR 250,000 threshold has been exceeded, is subject to a strict penalty regime.

In addition, Country-by-Country reporting obligations apply to multinational groups with consolidated revenues of at least EUR 750 million.

These requirements constitute a key element of tax risk management in Spain. Solid and consistent documentation provides essential protection during tax inspections, in which transfer pricing is one of the main areas of focus for the Spanish tax authorities.
 

What are the transfer pricing documentation requirements in Ireland?

Finance Act 2019 and subsequent legislative reform in recent years has significantly widened the scope of Irish TP rules with effect from 1 January 2020. The Irish TP documentation requirements are developed on three tiers in accordance with OECD guidelines: 

• Master File Form 
• Local File Form 
• Country-by-Country Reporting and Notifications

To manage and mitigate the compliance burden, the master file, local file and country by country requirements are subject to de minimus thresholds based on consolidated group turnover as follows:

• Master file for groups with consolidated revenues of €250M or more.
• Local file for groups with consolidated revenues of €50M or more.
• CbC reporting for groups with consolidated revenues of €750 million or more.

In light of the changes introduced, a new TP section has been added to the Irish corporation tax return (Form CT1). Under this new section, taxpayers are required to disclose their TP documentation obligations (i.e. Master File and Local File) for that fiscal return period.

It should be noted that Irish transfer pricing rules currently do not apply to “SMEs” which fall within the definition of “micro, small and medium-sized enterprises”, as defined in the Annex to the Commission Recommendations 2003/361/EC concerning the definition of micro, small and medium-sized enterprises. Therefore, the transfer pricing regime will not apply to enterprises that employ less than 250 employees and have either;

• a turnover not exceeding €50M, or
• total assets not exceeding €43M.

However, medium enterprises have been brought within the scope of Irish TP rules subject to a commencement order by the Minister for Finance. These requirements, once applicable, require medium enterprises to have simplified TP documentation in place for arrangements where the consideration exceeds €1M or €25M in the case of capital transactions. 

In addition, from 1 January 2022, new documentation requirements were enacted through Finance Act 2021 adopting the authorised OECD approach (“AOA”) to the attribution of profits to branches of non-Irish-resident companies with requirements to prepare detailed documentation known as “relevant branch records”. 

What are the transfer pricing documentation requirements in Germany?

The German transfer pricing documentation requirements are the following:

• Master File
• Local File
• Records of extraordinary transactions
• Country-by-Country Report

German regulations are based on OECD Transfer Pricing Guidelines, requiring transactions between related parties to be conducted at arm’s length. The rules apply to multinational enterprises with German operations, including German permanent establishments of non-German companies.

As of January 2017, large businesses/ groups meeting the Country-by-Country Reporting threshold (EUR 750 million revenue) must prepare a Master File and Local File. The scope of documentation is dependent upon the volumes of intercompany sales/services of the respective German entity. In detail, with transaction volumes deriving from intercompany services of up to EUR 600.000, respectively EUR 6 million of intercompany sales, a German entity is not required to prepare a formal transfer pricing documentation. Beyond these thresholds, local entities are required to prepare a local file, with a sales volume of EUR 100 million and more, a master file must be prepared additionally.

As of 2025 the transfer pricing obligations were tightened, e.g. deadlines for filing the required TP files have been shortened from 60 to 30 days. Transfer pricing documentation is to be submitted without being explicitly requested to do so, within 30 days of having been notified of a tax audit (without tax audit announcement on request within 30 days). The factual documentation requirement was expanded to include an overview of the intercompany transactions. A fine of at least EUR 5,000 will be imposed if this transaction matrix (transaction analysis with supporting information on underlying contracts/concepts and methods applied) as well as the master file (if required) and documentation on extraordinary transactions is not submitted in time. Local file is only to be submitted on tax auditor’s request, but if requested also within 30 days.

How can Auren & Moore assist?

Transfer pricing documentation requirements are becoming stricter at both international and national levels. Consequently, companies face an increasing administrative burden that requires time, money, and resources.

Whether you are active in manufacturing, technology, distribution, or services, your transfer pricing today must not only be compliant but also consistent, transparent, and well substantiated across borders.

Our local transfer pricing teams can assist you with this. Our teams work cross-border and are part of the broader international Moore network. This combination of local presence and international expertise enables us to support companies with all their documentation obligations, regardless of the size or complexity of their structure.

By leveraging technological support, we can prepare transfer pricing documentation such as the Master File, Local File(s), and the Country-by-Country report in a structured, compliant, and efficient manner. Thanks to specialized transfer pricing software, we can work quickly and consistently – especially for groups with entities in multiple countries – with less manual processing, lower error rates, and clear time savings. This directly translates into reduced costs for your company.

In short, Moore helps you not only to remain compliant but also to do so in a forward-looking and cost-efficient manner. Contact one of our local transfer pricing specialists to discuss how we can support you.