Italian Supreme Court Rules TP Irregularities Must Be Substantiated with Clear Avoidance Behaviour

Authors: Piergiorgio Valente, Federico Vincenti

In Ruling No. 27296, Italy’s Supreme Court rejected the tax authorities’ appeal against an Italian company’s transfer of goods and services to its German parent.
The Supreme Court ruled that if there is no clear economic advantage for a company, simply proving a transaction is not at arm’s-length is insufficient grounds for an adjustment.