Related party transactions are an important moment in the business of legal entities, especially in multinational groups. These transactions are increasingly becoming the subject of attention of the Tax Administration, so adequate pricing at which they are performed is crucial to minimize business risks within the Group.
The taxpayer is obliged to show transactions with related parties separately in his tax balance. It provides more detailed information on these transactions to the tax administration through transfer pricing reports. The goal is to determine the price of transactions between related parties.
The most important step is to choose a method for checking the compliance of transfer prices with prices determined on the principle of “out of reach”. The method chosen must be appropriate to the circumstances in which the transaction took place. The report on transfer prices is submitted to the Tax Administration upon its request, hence recommendation is to prepare a TP study on a yearly basis.
In Data-Link Unija Consulting we provide services of preparation of TP documentation for all regions in one place that leads us to the unique approach, best practice and lower prices if we prepare Master file and local files for several countries in region. We use the same data, that in case of international TP audit all related parties will be covered in the same manner.
Next to the preparation of TP documentation, we create TP policies for you, perform CBCR and CFC reporting as well as TP consulting services, in case you would like to check during the business year are you on the right path when it comes to the transactions with related parties.