Tolerance Limit for Transfer Pricing Remains Unchanged for Assessment Year 2023-24: CBDT
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- By Chetan Kulasri
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- Last Updated on 28 June, 2023
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Notification No. 46/2023, dated 26-06-2023
The Central Board of Direct Taxes (CBDT) has notified that the tolerance limit of 1 percent for wholesale trading and 3 percent in all other cases for ALP determination during the Assessment Year 2023-24. The same tolerance limit was notified by the board for the Assessment Year 2022-23.
“Wholesale trading” means an international transaction or specified domestic transaction of trading in goods, which fulfils the following conditions:
i. The purchase cost of finished goods is eighty percent or more of the total cost pertaining to such trading activities; and
ii. The average monthly closing inventory of such goods is ten percent or less of sales pertaining to such trading activities.
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