CBDT Keeps tolerance level for transfer pricing unchanged for AY 2015-16

CBDT vide notification no.86/2015/F.No.500/1/2014-APA-II, notified¬† the tolerance limits for international transactions / specified domestic transaction entered into by the assessee’s with associated enterprises as under:

  1. Wholesale Trading : 1%
  2. Others cases : 3%
transfer_pricing

For the purpose of this notification: Wholesale trading means an international transaction or specified domestic transaction of trading in goods which fulfills the following conditions:

  1. purchase cost of finished goods is 80% or more of the total cost pertaining to such trading activities;
  2. average monthly closing inventory of such goods is 10% or less of sales pertaining to such trading activities

The notification can be downloaded by clicking –> govt-notifies-old-tolerance-limit-of-1-and-3-under-new-tp-rule