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CA Final · Direct Tax Laws & International Taxation · Fundamentals of BEPS

Under the three-tiered transfer pricing documentation standard recommended in the BEPS Action 13 report, which document gives tax authorities a high-level overview of the multinational group's global business operations, its overall transfer pricing policies and the global allocation of income and economic activity?

The Master file is the document that gives tax authorities a high-level overview of the whole multinational group, including its business, transfer pricing policies and global allocation of income. The Local file deals with specific entity transactions, while the Country-by-Country report presents jurisdiction-wise financial data.

  1. ALocal file
  2. BMaster fileCorrect
  3. CCountry-by-Country report
  4. DTax audit report

Explanation

Action 13 has three tiers. The Master file gives the group-wide overview of business, intangibles, financing and transfer pricing policies. The Local file covers material transactions of a specific entity. The Country-by-Country report gives jurisdiction-wise data on revenue, profit, tax and activity. A tax audit report is not part of this framework.

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