Main contents of cost sharing agreement management and tax adjustments丨Indonesia Tax Guide 2025 (49)
Indonesia
Cost Sharing Agreement
2025-03-24 08:39:39
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This issue's introduction
Special Tax Adjustment Policy
Main contents of cost sharing agreement management
(1) Regulations require that services between related parties be priced on an arm’s length basis;
(2) Services between related parties are deemed to comply with the arm’s length principle if they meet the following conditions:
② The cost allocation price of the related party services is comparable to the price of comparable third-party services.
(3) The above-mentioned services actually occurred refer to economic activities that actually bring economic or commercial benefits to the enterprise and its related parties;
(4) The comparability of the cost allocation price of the above-mentioned related party services and the third-party price can be analyzed through the transfer pricing method prescribed by laws and regulations;
(5) If the above-mentioned related party service transactions are only caused by equity relations rather than transaction relations, the service transactions between related parties will be deemed to be inconsistent with the arm's length principle;
(6) The related party services that do not comply with the arm's length principle include the costs and expenses related to the following activities:
① The costs of the taxpayer's parent company holding shareholder meetings, issuing shares and carrying out management activities
② The costs of the taxpayer's parent company providing consolidated financial statements to the outside, unless there is evidence that the taxpayer benefits from the costs;
③ The costs of acquiring a subsidiary, unless the taxpayer benefits from the acquisition.
Cost Sharing Agreement Management Tax Adjustment
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