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April 16, 2024

Algerian Finance Ministry offers clarity on transfer pricing documentation and determining depreciation period for fixed assets

In its efforts to provide more clarity to the taxpayers, the Algerian Ministry of Finance has published two critical orders: the Order of 15 February 2024, determining the content and format of transfer pricing documentation, and the Order of 25 February 2024, aimed at setting the depreciation period for fixed assets, applied to determine taxable income.

Order on transfer pricing documentation

The 15 February order provides the content requirements for transfer pricing documentation to be presented during a tax audit, which should include (i) information relating to the group of related parties and (ii) information about the company subject to the tax audit.

The information relating to the group of related parties to which the company subject to a tax audit belongs must include:

  • A diagram illustrating the legal and capital structure of the group of related undertakings and the geographical location of the operating entities
  • A description of the areas of activity of the group of affiliated undertakings
  • Presentation of the intangible assets of the group of related parties
  • Presentation of the inter-company financial activities of the group of related parties
  • Presentation of the financial and tax situation of the group of related parties

The information related to the company subject to a tax audit includes:

  • Presentation of the organizational structure and areas of activity
  • Presentation of the transactions with related parties, including a detailed comparability and functional analysis
  • Financial information relating to the financial statement of the company and how they were used to apply the transfer pricing method and summary tables of information in the comparability analysis

The documentation must be submitted in paper and electronic format in one of the languages used by the tax authorities (French or Arabic).

Order setting depreciation period for fixed assets

An order has been issued setting the depreciation period for tangible and intangible fixed assets recorded in the balance sheet as of the fiscal year ending in 2023, applicable for the determination of the taxable income in accordance with the provisions of Article 141 of the Direct Taxes Code.

The depreciation period for fixed assets is initiated as follows:

  • For all fixed assets, whether tangible or intangible, from the date on which they are recorded on the assets side of the balance sheet
  • For fixed assets, whether tangible or intangible, acquired or realized as part of investment incentives schemes, from the date of start of the investment exploitation phase

The tax depreciation period for intangible fixed assets ranges from two to five years, and the tax depreciation period for tangible fixed assets the latter ranges from three to 100 years.

The following table provides some examples of the depreciation life of certain fixed assets:


Fixed asset type

Depreciation period

Intangible assets


Computer software

2 to 3 years


Licenses and trademarks

3 to 5 years


Software packages — ERP*

5 to 10 years

Tangible assets


Apartment building

50 to 100 years


Passenger vehicle

5 years



3 to 5 years

*ERP refers to enterprise resource planning.

The provisions of the order shall not apply to fully depreciated fixed assets shown as assets in the balance sheet for year ended in 2023.

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Contact Information

For additional information concerning this Alert, please contact:

Ernst & Young Advisory Algérie

Published by NTD’s Tax Technical Knowledge Services group; Carolyn Wright, legal editor

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