835F Small or medium-sized enterprise

Summary

(1) This section is not yet in operation and will commence on such date, and in respect of such chargeable periods, as the Minister may appoint by order. The section sets out the transfer pricing documentation requirements for SMEs.

Details

Definition of medium and small enterprises

(2) Definitions of “medium enterprise” and “small enterprise” are set out for the purposes of the section. These definitions are closely based on the category of micro, small and medium-sized enterprises as set out in the Annex to the EU Commission Recommendation of 6 May 2003. A small enterprise is an enterprise that, on a group basis, employs fewer than 50 employees and whose annual turnover and/or annual total assets does not exceed €10 million. A medium enterprise is an enterprise that, on a group basis, employs fewer than 250 employees and which has an annual turnover not exceeding €50 million and/or annual total assets not exceeding €43 million and which is not a small enterprise as defined. Certain modifications to the definitions contained in the Annex apply for the purposes of defining a medium enterprise and a small enterprise in an Irish context.

Small enterprises – Transfer pricing documentation exclusion

(3) A relevant person who is a small enterprise in a chargeable period is excluded from the transfer pricing documentation requirements set out in section 835G.

Medium enterprises – Transfer pricing documentation requirements

(4) A relevant person who is a medium enterprise in a chargeable period is only required to provide transfer pricing documentation in respect of relevant arrangements. An arrangement is a relevant arrangement where -

• (5)(a) it involves a medium enterprise and an associated person who is not a qualifying relevant person (as defined in section 835E) and the aggregate consideration arising under the arrangement in the chargeable period exceeds €1 million, or
• (5)(b) in the case of an arrangement that constitutes a disposal or acquisition of an asset for the purposes of chargeable gains, it involves a medium enterprise and an associated person who is not resident in the State and the arrangement relates to an asset with a market value above €25 million and the asset ceases to be a chargeable asset (in the case of a disposal) or was not a chargeable asset before its acquisition (in the case of an acquisition).

(6) A relevant person who is a medium enterprise is required to provide specified information in satisfaction of that person’s obligation to provide transfer pricing documentation under section 835G. The transfer pricing documentation requirements for medium enterprises are simplified and reduced as compared to enterprises that are not SMEs.

Relevant Date: Finance Act 2021