Transfer Pricing: Ensure your organisation is compliant

What do you need to do?

To ensure compliance with local tax laws and to demonstrate that profits are taxed appropriately across jurisdictions, transfer pricing documentation is essential.

HMRC expects transfer pricing records to be reviewed annually, to determine whether the functional and economic analyses are accurate and to update them as necessary. Typically, companies should undertake high-level reviews annually with a renewal of the transfer pricing documentation every three years or where there are material changes to the business. There are exemptions available to small or medium-sized enterprises (SMEs) in the UK, however the rules vary by jurisdiction. In addition, SME thresholds are being considered – so we recommend engaging professional advice and support to ensure that you have met all the requirements.

In contrast, large groups will almost always need to produce transfer pricing reports to meet the requirement to produce records to demonstrate how they set their transfer prices and to provide evidence that those prices are arm’s length.

When it comes to multinational organisations, the rules have recently changed from a UK perspective, and UK members of multinational groups with at least €750 million in revenues for the relevant period must now prepare transfer pricing documentation according to a prescribed format. You can find out more information on those changes here.

Our approach

Taking a tailored and bespoke approach, our team of transfer pricing specialists will invest time to understand your business and its inter-company relationships. Our focus is on building strong relationships with your team while delivering accurate and commercially practical transfer pricing solutions. Sitting within the Corporate Tax team, we are also able to bring together our wider expertise, tailored to your business needs – whether that’s tax planning and advice, R&D tax credit support, advice on funding, M&A, or personal taxes.

How we can help

Through the preparation of your documentation, we provide support in identifying the correct and commercially practical methodology. 

We then prepare transfer pricing documentation in accordance with UK requirements: 

• Setting out the current intercompany transactions between the group entities;
• Performing a functional analysis of the intercompany transactions;
• Undertaking a benchmarking exercise;
• Making recommendations to allow management to select an appropriate methodology for pricing intercompany transactions that appropriately reflects the economic reality of the UK activity; and
• Suggesting an appropriate range for the transfer pricing to be set at.

International reach

As a member of PrimeGlobal, one of the largest international accounting associations in the world, we can access a wide range of tools and resources to provide superior services to clients around the globe.

PrimeGlobal’s independent member firms operate in over 100 countries and house a combined total of over 3,000 partners, 28,000 employees and a combined revenue of over $3.9 billion. This connects us to local expertise around the world.

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