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As of 1 July 2021, in addition to the term “low-tax territory”, the term “non-cooperative jurisdiction” has appeared in the Income Tax Act. The amendment is related to the European Union's safeguard measures aimed at preventing tax evasion in transactions with companies located in so-called tax havens.

Grant Thornton Baltic advised Howden Finland Oy, the market leader in Finland and part of the international group Howden Broking, on the acquisition.

The Danish tax authority increased the taxable income of Tetra Pak Processing Systems A/S due to shortcomings in transfer pricing documentation and continuous losses. The Danish Supreme Court reached the conclusion that the transfer pricing documentation filed by the company did not meet the requirements as the documentation lacked a competent comparability analysis.

In the beginning of the year, several tax changes were introduced in Nordic-Baltic region. In addition we shall highlight tax rates applicable in the Nordic-Baltic region as of 2021.

Grant Thornton has released a new guide to help international entrepreneurs navigate transfer pricing regulations in different countries and keep up with recent changes.

Enterprises conducting transactions with related parties, such as companies in the same group or persons related to the owners of the company, must take into consideration domestic and international transfer pricing rules. The idea of transfer pricing rules is to prevent related persons from agreeing to sell each other goods and services at lower or higher than market price, thereby also transferring profit and income tax base.

Estonian entrepreneurs will develop an opportunity to grow significantly only if they are able to expand to foreign markets, says Kuldar Väärsi, the CEO of defence contractor Milrem Robotics.

Hundreds of companies are bought and sold each year in Estonia. In the case of bigger transactions, relying on assistance from transaction advisers has become the norm, although for the sake of total certainty, it’s a good idea to bring aboard an adviser even on smaller acquisitions.

Entrepreneurs believe the hard times are past and increasing turnover and profit will also lead many countries’ economic growth to faster recovery. A survey conducted by tax and business advisory firm Grant Thornton among business people in 36 countries found that business optimism is at a two-year high.

Indirect tax

Building tomorrow's $bn businesses

Maintaining proper accounting on transfer prices and documenting the reasoning for conformity to market value is in the interests of every enterprise, as it avoids tax risks. In preparing documentation, the requirements of legal acts should be considered along with the specific company’s risks and needs.

Many companies in the process of preparing annual reports for the last year find themselves facing the need to recognize transactions between related parties.