Canada: Transfer Pricing

Canada’s new transfer pricing rules are in effect for tax years beginning after the 2025 federal budget (i.e., 2026 for calendar year taxpayers). It will be many years before the courts weigh in on the impact of the amendments, but the time for multinationals to ready themselves for CRA audit scrutiny is now. Below, we outline the key changes in the amendments and the practical steps that taxpayers can take today.

On March 26, 2026, Canada's new transfer pricing rules received royal assent and will have a significant impact on multi-national enterprises (MNEs) in life sciences industries.

Navigate the complexities of Canadian transfer pricing audits with expert guidance on documentation requirements, CRA audit powers, and privilege protection. Learn strategic approaches to functional interviews, information requests, and compliance obligations while understanding the consequences of non-compliance and proposed legislative changes that could significantly impact audit procedures.

Over the past years the Government of Canada ("Government") has furthered tax reform by announcing legislative proposals and draft legislation and enacting technical amendments...

In an eventful start to 2026, the Federal Court of Appeal (FCA) has already released five notable tax decisions. Signalling an active and consequential year ahead...

The Tax Court of Canada's decision in ExxonMobil Canada Resources Company v R addresses the deductibility of $36 million in feasibility study costs for the Alaskan Gas Pipeline Project, examining whether transfer pricing rules apply to adjust or deny the deduction. The case explores critical questions about source of business income, arm's length transactions between related parties, and the application of Part XIII non-resident withholding tax in the context of cross-border pipeline development ventures.

Canadian taxpayers who engage in cross-border dealings with related non-residents face special reporting requirements. One of the most important filings in this area is CRA Form T106, Information Return of Non-Arm's Length Transactions with Non-Residents.

On November 4, 2025, the federal government tabled Canada Strong: Budget 2025 (Budget 2025), the first federal budget tabled by Finance Minister François-Philippe Champagne...

The 2025 federal budget includes draft legislation that would implement a significant rewrite of Canada's transfer pricing provisions, largely aligned with proposals released in a 2023 Department of Finance Consultation Paper.