Kuwait, 18 July, 2025 :Kuwait has officially introduced Transfer Pricing (TP) regulations as part of its Domestic Minimum Top-Up Tax (DMTT) Law, aligning with OECD TP Guidelines and marking a major compliance shift for multinational enterprises (MNEs).
Key Highlights:
🔹 Scope: Applies to MNEs operating in Kuwait with global revenues ≥ EUR 750 million in at least 2 of the last 4 years.
🔹 Arm’s Length Principle: All intercompany transactions (domestic & cross-border) must reflect market terms.
🔹 Related Persons: Defined broadly, including common ownership, control, or influence exceeding 50%.
🔹 Accepted TP Methods:
-
Comparable Uncontrolled Price (CUP)
-
Resale Price
-
Cost Plus
-
Transactional Net Margin Method (TNMM)
-
Profit Split
Documentation Requirements:
-
Master File and Local File: To be submitted within 30 days upon request.
-
Disclosure Form: Audited and filed with the annual tax return, detailing transactions, pricing methods, and other required data.
Compliance Steps:
-
Conduct an initial TP impact assessment
-
Review and align global and local TP policies
-
Prepare documentation and disclosures ahead of year-end
-
Monitor for further guidance from Kuwait’s Ministry of Finance
This move underscores Kuwait’s commitment to international tax standards and demands proactive compliance planning by MNEs operating in or through the country.
Source: www.pwc.com
