Counsel Razi Daureeawo of RD Chambers leads the settlement of a multimillion-dollar transfer pricing dispute with the Mauritius Revenue Authority for offshore client
The basis of the dispute before the Assessment Review Committee was a multimillion-dollar assessment raised by the Mauritius Revenue Authority for tax on deemed interest on an intra-group transaction under Section 75 of the Income Tax Act. Whilst the MRA argued that interest should be applied at a commercial rate on the specific transaction, in defence the taxpayer’s team argued that the transaction is to be viewed holistically taking into account the substance of the transaction, the intention of parties directly and indirectly involved in the transaction as well as related agreements and documentation. The defence also contended that foreign tax credit is to be allowed on a source by source basis against tax on the gross deemed interest. The dispute was settled following intense negotiations with the MRA involving technical and factual arguments.
“Delighted by the outcome. Thanks to the team – highly commended for their technical expertise, negotiation and advocacy skills, and client service.”