Transfer pricing, the practice of moving business profits from high tax to low tax or no tax countries in order to avoid paying tax, is currently a major issue for many Governments, revenue authorities, and international organisations.
Many tax systems round the world give revenue authorities a variety of powers to deal with transfer pricing if they feel that profits are being artificially moved to avoid taxation. That can mean an increase in a tax charge in one country. Sometimes there may not be a corresponding reduction in the tax charge in the other country involved so that a business can face a double tax charge on the same profits. Different countries will also have different reporting requirements.
Transfer pricing can be an issue for any business operating across borders. Even if its home country does not have transfer pricing requirements, it is likely that countries it does business with will.
How we can help
Winter International Tax Services can help in a number of ways.
- Transfer pricing business model review
We can review your business model to see where there may be transfer pricing risks and advise you on the action you can take to protect against these. This can also be a good opportunity to review your business model for overall tax efficiency. We also ensure that where you operate a transfer pricing policy over multiple jurisdictions, it is compatible with the relevant legislation in each.
- Documentation support
This is the key to supporting the pricing policy you use and minimising the chances of a successful challenge by the tax authorities. We can work with you by:
- Putting documentation in place (including economic studies where appropriate) to support your pricing policy
- Reviewing existing documentation, either globally or on a country specific basis
- Testing intra-group transactions against stated transfer pricing policies to ensure that they comply.
- Helping modify core documentation to meet country specific requirements
- Helping with transfer pricing reporting requirements in specific countries
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Business structure on set up or restructuring
If you are starting business in a new country, or if you are restructuring operations, (whether to improve efficiency, bring in new processes, change markets, customer demand or bring a new acquisition into the group), any change can affect your transfer pricing risk. We can help you minimise the risk of paying tax twice on the same profits, and can help structure your commercial operations to minimise tax, whilst being fully compatible with your commercial and reputational objectives.
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Tax Investigations by HMRC or other tax authorities
HMRC and other tax authorities are increasing the level of transfer pricing related enquiries and are being given more resources to do so. If your pricing policy is challenged, we can help you respond in the right way, and ensure the issue is resolved as quickly and cost effectively as possible.
Why Winter International Tax Services?
We offer a flexible and responsive service at competitive prices.