As the complexity of global trade increases so does the complexity of managing tax strategies, intercompany pricing and documentation.
Transfer pricing can be the most important international tax issue for many businesses. It refers to the pricing of transactions between related parties and covers goods, services, intangible property and debt. Fundamentally, the aim of legislation is to ensure that intergroup transactions are reflected at a commercial rate. This is typically referred to as the “arm’s length principle”.
The OECD guidelines for transfer pricing and country by country reporting have become more onerous. This has increased the complexity of documentation and reporting. In a world where tax transparency is a must, the need for a comprehensive and robust transfer pricing documentation is critical.
Our specialist team can assist with:
- Analysis and review: We can analyse and review the functions and transactions within your group, to ensure that the appropriate transfer pricing is in place. We can assist with the design and implementation of a policy for the group where appropriate.
- Benchmarking: We can compare and substantiate the transfer price applied by benchmarking comparable transactions of other similar service providers.
- Documentation: We can prepare UK transfer pricing documentation that is fit for purpose and robust if reviewed by HMRC. As part of the Prime Global international network, we have local experts around the world to complete global documentation requirements.
- Dispute resolution: Enquiries into transfer pricing are increasingly common, especially considering the increasingly complex global requirements, the COVID pandemic, and challenges around the digital economy. We assist many clients and can advise on a fair resolution to any transfer pricing enquiries.