Discover Botswana's evolving Transfer Pricing! While it's emerging, Botswana has taken giant leaps in robust TP regulations.

Discover Botswana's evolving transfer pricing! While it's emerging, Botswana has taken giant leaps in establishing robust TP regulations.

 The 2018 TP legislation, implemented in July 2019, focuses on transactions with non-resident 'connected persons', emphasizing control determined by share capital or voting rights. Applicable to domestic transactions and International Financial Services Center (IFSC) companies, this legislation requires TP documentation aligned with OECD Guidelines. Penalties loom for non-compliance, with audits targeting MNEs and specific industries.

Despite not being an OECD member, Botswana's involvement in the OECD BEPS Inclusive Framework grants access to the OECD Guidelines for interpreting TP legislation. The rules greenlight approved TP methods consistent with the OECD Guidelines, offering taxpayers flexibility to justify their chosen methods.

In Botswana's self-assessment regime, taxpayers are empowered to craft a TP policy and can even lock in specific transaction terms through Advance Pricing Agreements (APAs). This dynamic landscape necessitates meticulous documentation and adherence to specified methods, while also providing avenues for compliance.  

Looking to delve deeper into the landscape of transfer pricing in African countries? Download the full Grant Thornton Africa Transfer Pricing Landscape Guide 2023/2024 for a comprehensive overview, complete with detailed insights, country-specific regulations, and practical advice.