Transfer Pricing refers to the allocation of profits between related entities. Transfer pricing relates to numerous types of transactions including; performance of services between parties, loans between parties, sales of tangible property between parties, transfers of Intangible property between parties and lease of real or tangible personal property between parties.

During recent years, transfer pricing has gained greater attention from taxing authorities from all around the world. Countries have passed or introduced legislation with detailed requirements for taxpayers to justify and, more importantly, document that their intercompany pricing is at arm’s length. This mitigates the ability of companies to shift income from high-tax jurisdictions to low-tax jurisdictions.

At the most recent G-20 conference, Transfer Pricing was a visible topic. As a result of the conference, the nations that were present all agreed that the documentation to support the Transfer Pricing analysis between inter-company parties will be better scrutinized by local taxing authorities thus creating a greater burden on companies to provide even more contemporaneous documentation.

Please contact me directly for a complimentary value proposition to discuss the scope and application of a Transfer Pricing study when you have availability.