Informācijas tehnoloģijas purchased computer hardware from its Lithuanian affiliate TD Baltic, which in turn purchased it from unrelated wholesalers (manufacturers). The goods received were resold by Informācijas tehnoloģijas to unrelated companies. Following an audit, an assessment was issued where the tax authorities found that Informācijas Tehnoloģijas had purchased goods and services from related companies at a prices higher than the market price. The resale price method was applied by the tax authorities in determining the arm’s length price of the controlled transactions. An appeal was filed by Informācijas Tehnoloģijas with the Regional Administrative Court where, in a decision of 14 April 2014 the Court ruled in favor of the company. An appeal was then filed by the tax authorities with the Supreme Court. Judgement of the Supreme Court The Court annulled the decision of the Regional Court and remanded the case to the Regional Court for reconsideration. Excerpts “The Authority has indicated in its decision why the transaction values and ... Read more