A term often used in transfer pricing lingo is “contemporaneous transfer pricing documentation.” The meaning of this term is not always clear for everyone. In this short article we explain what it means.
Companies often spend a lot of time and money to analyze and document their transfer pricing arrangements. But proper implementation is equally important.
A transfer pricing policy ensures that everyone within the firm is “on the same page.” Moreover, it demonstrates that transfer pricing has been considered and implemented correctly, creating a record for internal and external stakeholders.
In this short article, we discuss what a transfer pricing policy is, why you should create one, and how to prepare one. [Read more…]
Transfer pricing has become the key focus area for tax authorities when assessing taxpayers. An explanation for this is that transfer pricing corrections are generally an easy way to drive tax proceeds. Within the industry it is observed that the number of transfer pricing “audits” increases when there is a large deficit in a government’s budget. This will of course be denied by tax authorities, but in practice, everyone knows about it.
If your firm is subject to Transfer Pricing Rules, there is a good chance that at some point you experience scrutiny on your policy. This may sound as a nightmare, and in some cases it is. However, the vast majority of transfer pricing audits do not end badly.
In this short article we provide information about transfer pricing audits, and suggestions on how you can handle these efficiently. [Read more…]