Transfer pricing adjustments (TP adjustments) are a complex and wide-ranging topic and their correct accounting is crucial. It is important to consider the perspective of both parties to the transaction before making adjustments. Why are they so important? Eliminating tax return errors – correct adjustments can help eliminate potential tax return errors, Secure recognition of…
The main principle of the game is the same International groups can manage the topic of transfer pricing in two ways – centrally and locally. Regardless of the choice of approach, the basic principle of transfer pricing remains the same. We are talking about the arm’s length principle, according to which settlements between related parties…
Transfer pricing is (primarily) an international issue. Why? Because business is international. These two aspects are intertwined and complete each other. Increasingly, organizations recognize the value of strategic transfer pricing management. Well-structured transfer prices not only supports robust business development, but also promotes it. However, it is crucial to remember that transfer pricing are not…
How well do you know MDDP’s Transfer Pricing Team? Did you know that this year we are celebrating the 20th anniversary of both MDDP and our Transfer Pricing Team? Over the years, we have built extensive experience and international expertise, which have brought us to where we are today: Almost 50 professionals We are a…
Financial transactions are one of the most common transactions between related parties and also most frequently controlled by the tax authorities. Due to the an extensive catalogue of financial transactions and their level of complexity, taxpayers often face problems in justifying the arm’s length nature of these transactions. In addition, the unfavourable approach to taxpayers…
With each passing year, courts increasingly confirm that a properly prepared benchmarking study can be an extremely important tool, both for taxpayers and tax authorities. Tax authorities often challenge benchmarking study by either conducting new analyses or modifying those presented by taxpayers. This frequently leads to increased tax liabilities. Therefore, having a reliable transfer pricing…
Today, we present the fourth and final entry in our series on transfer pricing. From previous posts, you already know what transfer pricing is (and certainly what it isn’t), who related parties are, and how to assess whether the prices applied in an intragroup transaction are at arm’s length. You’ve also become familiar with the…
Price adjustments are still not a clear-cut issue and raise questions for taxpayers. In 2023, administrative courts issued rulings on adjustments in three main areas described below. Definition of transfer pricing adjustments It is worth recalling that TP adjustments refer to transactions between related parties and are an important part of business practice. However, their…
The fundamental rule in transfer pricing is the arm’s length principle. When applied correctly, it ensures that related parties conduct transactions under terms that are consistent with those which would be agreed between independent parties. But how do we know that the conditions established in a given transaction are market-based? How can this be verified?…
Intra-group loan Intra-group loans, like other related party transactions, should be made on an arm’s length basis. In order to verify loan transactions to comply with the arm’s length principle, the comparable uncontrolled price method is most often used in the external variant. Data for this analysis is obtained from external specialized databases. Tax authorities…