{"id":2507,"date":"2025-11-20T18:38:43","date_gmt":"2025-11-20T10:38:43","guid":{"rendered":"https:\/\/ehluar.com\/main\/?p=2507"},"modified":"2025-11-21T18:43:52","modified_gmt":"2025-11-21T10:43:52","slug":"iras-releases-pilot-ssa-framework-for-baseline-marketing-distribution-activities-2026-2028","status":"publish","type":"post","link":"http:\/\/ehluar.com\/main\/2025\/11\/20\/iras-releases-pilot-ssa-framework-for-baseline-marketing-distribution-activities-2026-2028\/","title":{"rendered":"IRAS Releases Pilot SSA Framework for Baseline Marketing & Distribution Activities (2026\u20132028)"},"content":{"rendered":"\n

The Inland Revenue Authority of Singapore (IRAS) has released the 8th edition of the Transfer Pricing Guidelines (TPG), introducing a pilot implementation<\/strong> of the Simplified and Streamlined Approach (SSA) for baseline marketing and distribution activities<\/strong>. The pilot runs from 1 January<\/strong> 2026 to 31 December 2028<\/strong>.<\/p>\n\n\n\n

The introduction of the SSA follows Singapore\u2019s alignment with the OECD\/G20 Inclusive Framework\u2019s \u201cAmount B\u201d model for standardized returns to routine distribution activities, as set out in the Consolidated Report on Amount B (24 February 2025). Taxpayers applying the SSA must also observe the Annex to Chapter IV of the OECD TPG, relating to baseline distribution functions.<\/p>\n\n\n\n

1. Key Features of the SSA Pilot Framework<\/strong><\/h2>\n\n\n\n

1.1 Qualifying Conditions<\/strong><\/h3>\n\n\n\n

The TPG outlines criteria defining when a tested party qualifies for the SSA. While the IRAS has not materially departed from the OECD Amount B profile, taxpayers should expect conditions relating to:<\/p>\n\n\n\n

    \n
  • nature of distribution activity (routine, non-strategic),<\/li>\n\n\n\n
  • absence of complex intangibles or risks,<\/li>\n\n\n\n
  • standardised functional profile, and<\/li>\n\n\n\n
  • revenue-based thresholds.<\/li>\n<\/ul>\n\n\n\n

    Businesses with mixed-function distribution models may face practical segmentation challenges.<\/p>\n\n\n\n

    1.2 Determination of Return on Sales (RoS)<\/strong><\/h3>\n\n\n\n

    The SSA prescribes a fixed, standardised RoS range for qualifying distributors, consistent with Amount B\u2019s simplification objective. This eliminates the need for annual benchmarking studies within the SSA period.<\/p>\n\n\n\n

    Practical impact:<\/p>\n\n\n\n

      \n
    • reduces compliance effort,<\/li>\n\n\n\n
    • enhances tax certainty,<\/li>\n\n\n\n
    • limits taxpayer flexibility if actual margins deviate significantly from the SSA range.<\/li>\n<\/ul>\n\n\n\n

      1.3 Documentation Requirements<\/strong><\/h3>\n\n\n\n

      Although simplified, the SSA requires taxpayers to demonstrate:<\/p>\n\n\n\n

        \n
      • confirmation of meeting all qualifying conditions;<\/li>\n\n\n\n
      • application of the prescribed RoS;<\/li>\n\n\n\n
      • consistency with the OECD Amount B Annex.<\/li>\n<\/ul>\n\n\n\n

        Non-compliance may trigger adjustments or loss of SSA eligibility.<\/p>\n\n\n\n

        1.4 Inclusive Framework Commitment (2025\u20132029)<\/strong><\/h3>\n\n\n\n

        The guidelines reflect the Inclusive Framework\u2019s political commitment for jurisdictions adopting Amount B between 1 January 2025 and 31 December 2029, supporting a standard global approach to routine distribution pricing.<\/p>\n\n\n\n

        2. Key Amendments in the 8th Edition of the TPG<\/strong><\/h2>\n\n\n\n

        2.1 Use of Past TP Documentation (Para 6.35)<\/strong><\/h3>\n\n\n\n

        Taxpayers relying on qualifying past TP documentation without making the required declaration will not<\/strong> be regarded as having prepared simplified TP documentation under s 34F ITA.<\/p>\n\n\n\n

        Practical issue: Risk of non-compliance penalties if past-year documentation is used informally. Taxpayers should formalise declarations or prepare full TP documentation.<\/p>\n\n\n\n

        2.2 Mutual Agreement Procedure (MAP) \u2013 Flexibilities Added<\/strong><\/h3>\n\n\n\n

        (a) MAP applications when domestic remedies undecided (Para 10.56)
        Taxpayers may submit a MAP request within the DTA time limit even if still considering domestic legal remedies<\/strong>.
        This provides protection against time bars.<\/p>\n\n\n\n

        (b) Protective MAP filings allowed (Para 10.57)
        IRAS now explicitly recognises protective MAP filings to secure treaty relief timelines.<\/p>\n\n\n\n

        Practical issue: Ensures certainty for taxpayers facing foreign audit adjustments with ongoing disputes or incomplete information.<\/p>\n\n\n\n

        2.3 Pre-Application Meetings for MAP (Para 11.3)<\/strong><\/h3>\n\n\n\n

        Taxpayers requesting a pre-MAP meeting must provide detailed information (per TPG para 11.6(a)\u2013(k)) at least one month before the meeting.
        This increases administrative preparation but may reduce iterative IRAS queries.<\/p>\n\n\n\n

        3. Domestic Loans: No s 34D TP Adjustments from 1 January 2025 (Para 15.22)<\/strong><\/h2>\n\n\n\n

        IRAS will not impose transfer pricing adjustments under s 34D ITA for related-party domestic loans entered into on or after 1 January 2025, provided both parties are not in the business of borrowing and lending.<\/p>\n\n\n\n

        Additionally, IRAS will not require TP documentation for such loans.<\/p>\n\n\n\n

        However:<\/p>\n\n\n\n

          \n
        • interest deductibility remains subject to s 14(1)(a), and<\/li>\n\n\n\n
        • interest restriction rules still apply.<\/li>\n<\/ul>\n\n\n\n

          Practical issues:<\/strong><\/p>\n\n\n\n

            \n
          • While TP compliance is eliminated, taxpayers must still assess commerciality and deductibility under domestic provisions.<\/li>\n\n\n\n
          • Cash-pooling or treasury-type entities may fall outside this concession.<\/li>\n<\/ul>\n\n\n\n

            4. Practical Implications<\/strong><\/h1>\n\n\n\n

            4.1 Evaluate Eligibility for SSA Early<\/strong><\/h3>\n\n\n\n

            Entities with distribution activities should conduct a functional and financial assessment to determine SSA eligibility before FY2026.<\/p>\n\n\n\n

            4.2 Review Intercompany Agreements<\/strong><\/h3>\n\n\n\n

            Contracts should reflect SSA-based returns where applicable and ensure alignment with OECD Amount B principles.<\/p>\n\n\n\n

            4.3 Strengthen MAP Readiness<\/strong><\/h3>\n\n\n\n

            Given the expanded MAP options and timelines:<\/p>\n\n\n\n

              \n
            • maintain robust audit files,<\/li>\n\n\n\n
            • prepare for cross-border controversy events,<\/li>\n\n\n\n
            • consider protective MAP filings where foreign assessments are anticipated.<\/li>\n<\/ul>\n\n\n\n

              4.4 Update TP Documentation Policies<\/strong><\/h3>\n\n\n\n

              Taxpayers must ensure correct declarations under s 34F when relying on previous-year documentation.<\/p>\n\n\n\n

              4.5 Review Domestic Financing Arrangements<\/strong><\/h3>\n\n\n\n

              Although s 34D adjustments no longer apply for non-lending domestic parties, documentation supporting:<\/p>\n\n\n\n

                \n
              • purpose of loan,<\/li>\n\n\n\n
              • arm\u2019s-length level of interest, and<\/li>\n\n\n\n
              • deductibility criteria
                should still be maintained for tax audit purposes.<\/li>\n<\/ul>\n\n\n\n

                Source: <\/strong>IRAS, 20 November 2025<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

                The Inland Revenue Authority of Singapore (IRAS) has released the 8th edition of the Transfer Pricing Guidelines (TPG), introducing a pilot implementation of the Simplified and Streamlined Approach (SSA) for baseline marketing and distribution activities. The pilot runs from 1 January 2026 to 31 December 2028. The introduction of the SSA follows Singapore\u2019s alignment with […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"nf_dc_page":"","_et_pb_use_builder":"off","_et_pb_old_content":"","_et_gb_content_width":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[7,8,6],"tags":[],"class_list":["post-2507","post","type-post","status-publish","format-standard","hentry","category-accounting","category-incometax","category-techupdates"],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/posts\/2507","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/comments?post=2507"}],"version-history":[{"count":1,"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/posts\/2507\/revisions"}],"predecessor-version":[{"id":2508,"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/posts\/2507\/revisions\/2508"}],"wp:attachment":[{"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/media?parent=2507"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/categories?post=2507"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/ehluar.com\/main\/wp-json\/wp\/v2\/tags?post=2507"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}