Italian Transfer Pricing documentation in light of the Circular letter No. 15/E/2021

Introduction

On November 26^th, 2021, the Italian Revenue Agency (the “IRA”) published, following the public consultation time frame, the Circular Letter no. 15/E (the “Circular”) providing clarifications on transfer pricing documentation (the “TP Documentation”) rules contained in the Administrative Provision n. 360494 of November 23^rd, 2020 (the “Provision”).

Italian taxpayers may opt to prepare TP Documentation to benefit of the penalty protection regime in the event of a tax assessment. In the absence, penalties for unfaithful tax return (from 90% to 180% of the higher due taxes) become applicable.

Below we provide a comprehensive view on Italian TP Documentation rules in the light of the above Circular, hoping that the existing uncertainties will be further clarified in the near future.

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