The APA is the decision of a tax authority on a transfer pricing issue given by a specified subject for a specified period of time. The APP is binding on the Finnish tax administration for the duration of its application if the subject complies with the general terms of the APP for the duration of the agreement and if the critical assumptions contained in the agreement are updated. In addition, it is necessary that the taxpayer has provided truthful information and that the legal provisions on which the APA is based have not changed. Here are the models of applicants` declarations that the applicant must submit to the authorities after the signing of the pre-price agreement. Jurisdiction of the BZSt with respect to mutual agreement, arbitration and APAs The pre-price agreement is always made at the initiative of the taxpayer. The APP procedure begins with the written request of the subject to the competent authority. There is no standard format for application in Finland, but the subject should check with the competent authorities of other countries to verify the requirements set in those countries for the application for APA (for example. B deadlines for submitting the application, content requirements). The APA procedure is generally conducted in English, which is why the application for the APA must be written in English. Following the signing of the pre-price agreement with the State or foreign countries, BZSt informs the applicant in writing of the result and asks him to approve the content of the agreement. In addition, the applicant is asked to waive his right of appeal to the tax office. Once the applicant has agreed to the content and waived his right of appeal, the tax office grants the applicant the corresponding mandatory prior obligation to implement the pre-transfer prices at the national level. A pre-price agreement gives the taxpayer certainty as to how the pricing of APA transactions is treated with income tax when the taxpayer acts under the APA.
At the same time, the taxpayer can also avoid an international double taxation related to the pricing of these transactions, since all contracting parties to the APA agree to accept the compensation fees in accordance with the APA. The appropriate authorities may agree that the subject is required to submit a notification after the APA. The subject may, for example, be required to notify the appropriate authority each year of compliance with the current APA. This reporting obligation is not related to the obligation to provide tax returns or the obligation to provide transfer pricing information, as it relates to a separate notification to the competent authority.