Tax Audits and Transfer Pricing for the Transport and Logistics Sector

Introduction

Cambodian tax issues for freight forwarders, liners and other international transporters, logistics service providers and their agents are among the most complex from all industry sectors. Often, payments for international transport made by customers go through Cambodian bank accounts of agents or subsidiaries and trigger GDT scrutiny. Shared services and allocation of global expenses at times been used by tax officials to impose taxes. New 2023 rules about agents and permanent establishments will muddle the waters further. What issues can you win in tax audits, and how to better arm yourself against transfer pricing disputes?

In this highly practical briefing, we focus on the real tax issues transport and logistics companies face in tax audits. What to do if the GDT feels your profit margin is too low, or when the payments you make to the head office must also be taxed?

Highlights

• GDT practices on actual tax audits in the logistics sector: what are the key lessons learned?
• Ocean freight and other payments for foreign liners or transports remitted by Cambodian agents, freight forwarders or subsidiaries
• Are ocean freight fees, document fees and THC taxable in Cambodia?
• Shared services, fees paid to group head office: tax audit challenges
• Transfer pricing for logistics companies and service providers
• What steps can you take to protect yourself from GDT challenges?
• What is a normal or arm’s length profit margin for a logistics company? Actual case study