Transfer Pricing

Transfer Pricing is a primary component of the international tax framework which holds across nations in today’s hyper globalized world of business. With the OECD’s BEPS ( Base Erosion and Profit Shifting) focused on taxing value creation, multinational groups now face increasing compliance obligations on top of their large operational volumes and transactions. The challenges are compounded because of the continuously evolving global regulatory landscape and greater country-level compliances. Transfer Pricing lies at the heart of these dynamics.

International transactions – in the form of sales of goods and services, financial transactions, or exchange of other intangibles – between entities of a multinational enterprises (MNE) group based and operating in different countries is common in today’s world. Transfer Pricing is the internal price charged for these transactions by one member of an MNE group to another member in a different country. Such transactions necessitate increasing numbers of regulatory compliances across jurisdictions. Since these jurisdictions are well connected with swift and regular information sharing about related party transactions (RPTs) across international borders via such mechanisms as Automatic Exchange of Information (AEOI) and Country-by-Country Reporting (CbCR), compliance is also being enforced more strictly. Being complex and time consuming , these multi-jurisdiction compliance processes can stretch company resources away from their core business.
Transfer pricing (TP) is an ongoing and critical task for MNE groups calling for their full attention and demanding strong skills and competencies. MNEs must have a strong methodical process for the various requirements such as TP risk management and controls, documentation, TP study (local file), master file, TP records and processes, etc.

At MBG Corporate Services, our extensive and intensive knowledge of compliance needs across various international tax jurisdictions’ local Transfer Pricing regulations, CbCR regulations and tax legislation enables our clients to meet their compliance accurately and on time. Our Transfer Pricing team and tax advisors use their global experience to support them on filings and deliver high quality TP counsel.
MBG’s Transfer Pricing strategy both meet regulatory demands and your strategic and operational global objectives. Our TP models use continuous financial analysis and timely intervention to align with your value chain and have the flexibility and responsiveness built into them to handle changing market dynamics. We ensure that all related party transactions are documented to position your Transfer Pricing model in compliance with regulatory requirements. We navigate your way through the complexities of international tax and mitigate your non-compliance risks.

MBG Corporate Services supports you with :

• Compliance of your current TP policies with requisite documentation
• Executing new TP models based on new supply chain dynamics
• Defending your transfer pricing with authorities
• Dispute resolution
• Impact assessment of Base Erosion and Profit Shifting (BEPS)

Our TP Advisory services include:

• Due diligence and diagnostic reviews on Transfer Pricing
• Developing tax efficient and globally defensible TP models across businesses and jurisdictions
• TP health check, correction of gaps in your accounting records
• TP counsel on business restructuring and value chain analysis and transformations (VCTs)
• Evaluating the impact of new TP/tax rules on current TP policies and transactional arrangements
• Drafting of TP policies based on pre-benchmarking
• Drafting and vetting of agreements from a TP perspective
• TP model implementation support
• Advice on TP policy vis-a-vis Customs valuations
• Advice on legal versus beneficial ownership of intangibles and on other elements under BEPS AP 8-10 (aligning Transfer Pricing outcomes with value creation)

MBG’s TP Compliance and Litigation support services include:

• Preparation of Transfer Pricing Documentation & Study (Local Files) as per the local Transfer Pricing and tax laws and BEPS guidance, with industry and group overview, functional, and economic / benchmarking analyses of Related Party Transactions against industry margins and evaluation of TP methods
• Preparing three-tiered documentation including Local files, Master files and CbCR templates per local tax laws and BEPS guidance to support TP Policies
• Help with TP certificate, form filings and related disclosures in tax returns
• Support with tax authority litigation and dispute resolution