The Law Amending and Supplementing the Law on Corporate Income Tax was published in the Official Gazette of Republika Srpska, No. 114/2025 of 29 December 2025. One of the more significant amendments concerns transfer pricing, namely the obligation of businesses to hold and submit transfer pricing documentation.
Very soon after these amendments were published, transfer pricing became one of the “hot” topics among business owners and accountants:
- what transfer pricing is,
- who is subject to the obligation,
- and what the consequences of non-compliance with the Law are.
It is important to stress that the obligation to hold a transfer pricing study is not new. Taxpayers with related-party transactions were already required to hold adequate documentation (a transfer pricing Study/Report) at the time of filing the tax balance and to submit it within 30 days of a request from the tax authority.
The previous legal framework also contained penalty provisions in the form of fines for not holding transfer pricing documentation and for failing to submit it within 30 days of a request from the tax authority, ranging from BAM 20,000 to BAM 60,000 for a legal entity and from BAM 5,000 to BAM 15,000 for the responsible person in the legal entity.
What is genuinely new, however, is the obligation of proactive submission of documentation (the transfer pricing Study/Report), without a specific request from the tax authority. The Study/Report must correspond to the data in the tax return for the previous year, which is filed no later than 31 March of the current year for the previous tax year.
Under the new rules:
- transfer pricing documentation must be submitted to the Tax Administration within nine months of the end of the tax year, without a specific request from the Tax Administration,
- a materiality threshold of BAM 50,000 has also been introduced: the obligation arises if the total value of related-party transactions (including credits and loans) exceeds this amount during the tax year.
Past practice among legal entities (only if the inspector asks)
In practice, the most common answer we hear from clients is:
“I'll deal with it when the tax inspector asks for it.”
This approach no longer works. Not only is it contrary to the Law, it also poses a direct financial risk to the taxpayer.
Why does this approach no longer work? Because the Law on Corporate Income Tax clearly states that:
- transfer pricing documentation must exist at the time the tax return is filed,
- transfer pricing documentation must contain analyses and evidence that the transactions are at market terms,
- and now, in addition, transfer pricing documentation must be submitted to the tax authorities, without a request, within nine months of the end of the tax year.
In practice, this means that if you prepare the documentation after the fact:
- you weaken your position before the tax administration,
- you increase the likelihood of a tax base adjustment,
- you open the door to fines and default interest, and possibly to the risk of the tax administration treating it as tax evasion.
On the other hand, a properly prepared, timely study gives you:
- control over tax risk,
- the possibility of making adjustments before filing the tax return,
- arguments in the event of an audit,
- certainty in your dealings with related parties.
Most importantly: a transfer pricing study is not just “another piece of paperwork for the tax inspector” – it is a tool that protects you.
For the more “advanced” and “self-aware”, structuring related-party transactions in line with market conditions and principles before the transaction takes place is a further step forward that makes preparing the documentation and the study easier later on.
Don't wait until the deadline!
The 9-month statutory deadline may make it seem that you have plenty of time. In reality, most companies react late, and that is when problems arise:
- there is not enough time for a quality analysis,
- the search for comparable data becomes limited,
- the cost of preparing the study rises,
- if the Study shows that prices were not at arm's length, you are automatically required to correct your tax return and pay default interest on the calculated difference,
- which is why stress and risk reach their peak.
Preparing a quality transfer pricing study requires:
- a detailed understanding of your business,
- an analysis of transactions and functions,
- finding comparable market data,
- applying the appropriate methods.
A transfer pricing study is not a document made “overnight”, and the biggest mistake you can make is to put these activities off until later.
What does all this mean for you in practice?
If your business:
- has transactions with a related legal entity or individual,
- grants or receives loans between related legal entities and individuals,
- sells goods or services within the group,
you are very likely required to have a transfer pricing study.
How can we help you?
Instead of thinking about transfer pricing when the tax inspector arrives or the statutory deadline approaches, you can deal with it on time and without stress.
We can help you:
- identify risky transactions, even before you carry them out,
- assess whether you are required to hold transfer pricing documentation, i.e. whether you are obliged to prepare a Study/Report.
Once it has been established that you are required to hold transfer pricing documentation and, consequently, to prepare a Study/Report, we:
- prepare the complete transfer pricing documentation,
- prepare the transfer pricing Study/Report,
- propose any adjustments to the tax base (if you contact us before the transaction takes place, the risk of a tax base adjustment arising from these transactions is fully minimised).
By preparing an adequate transfer pricing study, we help you be ready for a possible tax audit.
Conclusion
Transfer pricing is no longer a “topic for later”. It is now:
- a legal obligation,
- a potential tax risk,
- but also an opportunity to keep your business under control.
In the end, the question to ask yourself is not “Do I need a transfer pricing study?” but “Do I want risk or certainty in my dealings with related parties?”
