Transfer prices can impact the amount of income taxed in different countries. To ensure compliance, set these prices at the same level that unrelated parties would use in their transactions. Here’s how to do it. Various transfer pricing verification methods are used to assess the prices set between related parties. There are five basic methods,…
What is a benefit test? The benefit test is an analysis that confirms the following: the purchased intangible services have indeed been performed, the recipient derives benefits from the purchase that contribute to their income, the purchase of services is business rational. Who does it apply to? The benefit test applies to all group entities…
Authorities around the world are increasingly scrutinizing the nature of intra-group loans We observe that tax authorities and courts are more frequently recharacterizing loan transactions, challenging their substance and arm’s length nature. Authorities are now examining not only the market terms of the interest rate but also the underlying substance of the transaction. They are…
International groups often prepare global benchmarks, which are used by entities in different jurisdictions for local transfer pricing documentation. This approach ensures consistency in global transfer pricing policies and helps reduce the local costs associated with transfer pricing obligations. But is there a universal benchmarking that guarantees the defensibility of transaction arm’s length conditions in…
Increasing globalization is connected with not only threats but also with numerous opportunities. Multinational companies create innovations and know-how, which can be shared with other group entities or transferred to affiliates in other countries. During the transfer of intangible assets, it is crucial to analyze the pros and cons of the planned relocation. Remember that…
International groups often undergo business restructuring. If done between related parties, it must comply with the arm’s length principle. We understand that each restructuring can have its unique characteristics, which complicates the verification of its market nature. Additionally, restructuring under transfer pricing regulations may involve various, sometimes unexpected, transactions. What do the OECD guidelines say…
The latest edition of Santander Trade Barometer reveals that nearly a third (28%) of UK domestic businesses are planning global expansion within the next three years, marking the highest level in two years. Additionally, 56% of businesses in the US, 39% in Spain, and 38% in Poland are also contemplating cross-border expansion. Entrepreneurs are going…
Transfer pricing adjustments (TP adjustments) are a complex and wide-ranging topic and their correct accounting is crucial. It is important to consider the perspective of both parties to the transaction before making adjustments. Why are they so important? Eliminating tax return errors – correct adjustments can help eliminate potential tax return errors, Secure recognition of…
The main principle of the game is the same International groups can manage the topic of transfer pricing in two ways – centrally and locally. Regardless of the choice of approach, the basic principle of transfer pricing remains the same. We are talking about the arm’s length principle, according to which settlements between related parties…
Transfer pricing is (primarily) an international issue. Why? Because business is international. These two aspects are intertwined and complete each other. Increasingly, organizations recognize the value of strategic transfer pricing management. Well-structured transfer prices not only supports robust business development, but also promotes it. However, it is crucial to remember that transfer pricing are not…