Transfer Pricing Services
Transfer Pricing Services
Corporate Tax affects inter-company, inter-group, and international transactions. And if not managed well, it may lead to non-compliance and, sometimes, unnecessary tax burden. This requires expert Transfer Pricing Services to ensure firms do not adopt Tax Evasion strategies and do fair reporting of inter-company transactions.
Transfer Pricing Advisory Services include Domestic Transfer Pricing (Transfer Pricing UAE) and International Transfer Pricing. Tax departments from other jurisdictions and International Tax Authorities scrutinise cross-border transactions to check compliance with Transfer Pricing rules. Locally, you must comply with the taxation laws, which include reporting local intra-group transactions.
Such transactions increase the need for time and competency in analysing them and recording their entries. It requires creating more records, defining new processes, and risk management. Not only Domestic Transfer Pricing regulations, but entities must stay abreast of the International Transfer Pricing landscape in countries where they have operations.
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Our Transfer Pricing Services
Fame Advisory is an expert Transfer Pricing Services provider in the UAE. Our Corporate Tax Consultants have knowledge and expertise in taxation matters. We are here to help you understand the corporate taxes on inter-company domestic and cross-border transactions.
We analyse all your transactions to ensure that the company meets the Transfer Pricing Requirements. We ensure you carry out your cross-border operations within the Transfer Pricing rules. Our Corporate Tax Consultants also manage the documentation requirements.
Our range of Transfer Pricing Services includes the following:
International Tax Compliance
Our Transfer Pricing reviews include the review of domestic Transfer Pricing and International Transfer Pricing. We review your local and cross-border transactions conducted internally within the group, their types and volume. We understand the transfer pricing position of each transaction type based on local laws and International Transfer Pricing practices.
Such diagnostic reviews and health checks enable the identification and correction of gaps in accounting records. It also gives you a better idea of Transfer Pricing risks and how to manage them to comply with relevant regulations.
We provide professional and competent advice to our clients on all Transfer Pricing Transactions and Questions. We advise you on the possibility of incorporating tax efficiencies into the existing intra-group transactions. You can consult us for the alignment of Transfer Pricing Policies with business productivity objectives.
Our Corporate Tax Advisors advise on Business Restructuring and Supply Chain Transformation based on Transfer Pricing Policies. You can find immediate answers from our Tax Advisors on transfer pricing queries, customised to your business.
We help you maintain proper documents for Transfer Pricing Transactions to show your compliance with the regulations to relevant authorities. Non-compliance can lead to Transfer Pricing disputes. So, we check the type, volume, and complexity of your domestic and international transactions to detect Transfer Pricing issues and resolve them for compliance purposes.
Such detailed documentation helps you at the time of Transfer Pricing Audit by authorities. Tax Authorities, Regulators, and Auditors may ask for proper documents during the Transfer Pricing Audit. You need to present these documents; otherwise, penalties or fines may apply.
OECD guidelines require entities to adopt a three-tiered approach for handling documentation for Transfer Pricing Transactions:
- Master File: Standard data for all members of the Multinational Entity (MNE) group in accordance with OECD laws
- Local File: Information on entities in the local jurisdiction as per the local laws
- CbC Report: Global allocation for the incomes and taxes paid of the MNE group, along with the location of economic activity.
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FAQs: Transfer Pricing Services
Transfer Pricing means the price of a transaction carried out between two or more related parties operating in the same or different jurisdictions. If there is a transaction between the parent company and its subsidiary or two subsidiaries, the price charged by the seller is called the Transfer Price. The OECD Transfer Pricing Rules require the transaction to be treated like it is being conducted between two independent, unrelated parties.
Now, suppose C is the subsidiary of A. A has sold the same thing to C. Considering that A would earn profits from the transaction, on which it must pay corporate tax, A sells it to C at reduced prices. The reduced-price leads to a profit of only AED 380,000.0. Now, A must pay a tax of 9% on it, due to which the tax liability is AED 450.0.
Thus, since C is a related party, A sells it to them at a discount to reduce their tax liability. Internationally, transfer pricing rules require entities to conduct international transactions with related parties at arm’s length price.
Transfer pricing rules in UAE follow the OECD Transfer Pricing Rules. As per these rules, entities must follow these rules while carrying out transactions between the group entities and managing the documentation.
When calculating the Tax Liabilities of a group company, the amounts of all subsidiaries are consolidated. Earlier, inter-company transactions were eliminated at the time of financial consolidation. Now, these transactions must be undertaken at an arm’s length price. UAE entities must follow the new Transfer Pricing Rules for both cross-border and domestic transactions.