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Home » Posts » South Africa’s First Transfer Pricing Case

South Africa’s First Transfer Pricing Case

SARS HAVE PUBLISHED THE JUDGMENT: DOWNLOAD IT HERE>>>

I’d like to refer to the article: “South Africa’s first Transfer Pricing case, and it’s a win for the taxpayer!”

Transfer pricing is critical, especially when ensuring compliance with local tax regulations. The case of ABD Limited vs. The Commissioner for the South African Revenue Service (SARS) sheds light on the complexities and challenges surrounding transfer pricing practices in South Africa. This matter highlights the potential pitfalls for multinational companies and demonstrates the vital role of expert legal teams, such as TRM, in navigating these challenges successfully.

The Importance of the Case

Transfer pricing, the practice of setting prices for transactions between companies within the same corporate group, is crucial for tax purposes. It ensures that transactions with foreign subsidiaries are priced as if they were conducted between unrelated parties, maintaining fairness and preventing tax evasion. The ABD Limited case raises unique questions about transfer pricing, especially concerning the royalties for intellectual property rights and how they should be calculated to comply with South Africa’s tax laws.

TRM’s Role

This significant case underscores the expertise and effectiveness of TaxRiskManagement.com’s team. Specializing in transfer pricing disputes, we provided unparalleled guidance through this complex tax litigation process, demonstrating our deep understanding of South African tax laws and international transfer pricing principles. The strategic approach and meticulous preparation were instrumental in challenging SARS’s increased assessment based on the arm’s length principle—a cornerstone of transfer pricing regulations.

DOWNLOAD THE JUDGMENT HERE>>>

Dr. Daniel N. Erasmus’s Upcoming Contributions

Dr. Daniel N. Erasmus further explores these complexities in his upcoming book: “Conducting a TP Trial.” His work promises to be an essential resource for legal practitioners and multinational corporations, offering deep insights into the strategic considerations and legal frameworks surrounding transfer pricing trials.

Compare Programmes

Choose the track that fits your practice focus. All programmes are practitioner-taught, cohort-based, and validated by Middlesex University.

Dimension	Transfer Pricing	International Taxation	South African Tax Law
Jurisdictional audience	Global audience, covers all jurisdictions	Global audience, covers all jurisdictions	South Africa specific, relevant to SADC region
Ideal for	TP managers, advisors, in-house tax teams, analysts moving into TP	Advisors and managers dealing with cross-border rules, treaties, planning	Practitioners working with the SA Income Tax Act, cases, compliance
Core focus	Methods, comparables, DEMPE, documentation, audits, dispute defence	Treaties, source vs residence, anti-avoidance, PE, relief from double tax	Statutory interpretation, case law, assessments, objections, local practice
Primary tools	OECD TP Guidelines, UN Manual, BEPS Actions 8–10, 13, case law	OECD and UN Models, MLI, BEPS 1.0 and 2.0, domestic rules, cases	Income Tax Act, SARS practice notes, Tax Administration Act, SA cases
Assessment style	Case-based assignments, file reviews, short written defences	Problem questions, treaty interpretation, position papers	Problem questions, statutory analysis, case commentary
Typical outcomes	Build defensible TP files and strategies, improve audit readiness	Design cross-border structures within rules, mitigate double tax	Apply SA tax law accurately, manage reviews and disputes
Entry point	Start with PG Certificate, progress to PG Diploma, then MSc, or enter later with suitable experience or credits.

Awards Ladder

Award	Best for	What you achieve	Assessment highlights
PG Certificate	Foundation to intermediate upskilling	Core concepts, frameworks, and applied techniques	Short case write ups, timed responses, applied tasks
PG Diploma	Expanding technical depth and application	Advanced analysis, risk management, documentation quality	Integrated case assignments, policy memos, oral defence
MSc	Leaders and specialists building authority	Capstone project and research backed practice outcomes	Research project, viva or presentation, publishable summary

IFF Certificate Courses

Practical, practitioner-led certificates designed for immediate on-the-job application. Each course can stand alone or act as a pathway into our postgraduate tracks.

Dimension	Conducting a Transfer Pricing Trial	Effectively Managing Tax Teams	Indirect Taxation	Tax Risk Management
Jurisdictional audience	Global audience	Global audience	Global audience, with local adaptation	Global audience
Ideal for	In-house tax, TP managers, litigators, advisors preparing for audits, ADR, trial	Heads of tax, managers, team leads, controllers, emerging leaders	VAT, GST, customs, finance managers, AP, AR, compliance specialists	Tax managers, risk officers, controllers, advisors building governance
Core focus	Case theory, evidence files, expert reports, witness prep, courtroom strategy	Operating models, KPIs, workflows, stakeholder management, coaching	VAT design, place of supply, input credits, exemptions, WHT interactions	Risk identification, controls, documentation, audit readiness, dispute playbooks
Delivery mode	Online, live sessions plus guided self-study	Online, live sessions plus guided self-study	Online, live sessions plus guided self-study	Online, live sessions plus guided self-study
Duration	16 weeks, part-time	16 weeks, part-time	16 weeks, part-time	16 weeks, part-time
Outcomes	Confident litigation preparation and defence for TP disputes	Stronger execution, clear roles, measurable team performance	Reduced VAT errors, better cash flow, fewer surprises at audit	Structured governance, fewer findings, faster dispute resolution
Prerequisites	TP fundamentals recommended	Supervisory experience helpful	Basic VAT knowledge helpful	General tax experience helpful
Pathway	Progress to PG Certificate in Transfer Pricing	Progress to Mechanics of Leading Tax Teams, PG Certificate (leadership)	Progress to PG programmes, International Tax or SA Tax Law	Progress to PG Certificate in International Taxation or Transfer Pricing
Assessment	End of module progress assessment 5000-word assignment if PG-Cert option elected	End of module progress assessment 5000-word assignment if PG-Cert option elected	End of module progress assessment 5000-word assignment if PG-Cert option elected	End of module progress assessment 5000-word assignment if PG-Cert option elected

Transfer Pricing

International Tax

South African Tax Law

Mechanics of Conducting a TP Trial

Mechanics of Leading Tax Teams

Mechanics of Indirect Taxation

Mechanics of Tax Risk Management

Mastering Tax Dispute Resolution in South Africa

South Africa’s First Transfer Pricing Case

Table of Contents

The Importance of the Case

TRM’s Role

Dr. Daniel N. Erasmus’s Upcoming Contributions