We offer comprehensive Transfer Pricing Services to ensure compliance and optimize inter-company transactions.
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Corporate Tax affects inter-company, intra-group, and international transactions, and if not managed effectively, can lead to non-compliance and unnecessary tax burdens. This underscores the importance of professional Transfer Pricing services to prevent tax avoidance and ensure accurate reporting of inter-company transactions.
Our Transfer Pricing Advisory Services cover both Domestic (UAE) and International Transfer Pricing. Tax authorities in various jurisdictions closely scrutinize cross-border transactions to ensure compliance with Transfer Pricing regulations, while local laws also mandate the reporting of intra-group transactions.
Given the complexities involved, businesses need a comprehensive analysis and thorough documentation, which requires the adoption of new processes and risk management strategies. Companies must not only comply with Domestic Transfer Pricing rules but also stay updated on International Transfer Pricing guidelines in all jurisdictions where they operate.
Litrix Business Solutions DMCC is a leading provider of Transfer Pricing services in the UAE. Our team of expert Corporate Tax Consultants has extensive knowledge and experience in taxation, helping you navigate the complexities of corporate tax compliance for both domestic inter-company and cross-border transactions.
We perform a detailed analysis of all your transactions to ensure compliance with Transfer Pricing regulations. Our specialists ensure that your international operations align with Transfer Pricing requirements, and we manage all the necessary documentation to keep you fully compliant with the relevant laws.
Our Transfer Pricing reviews encompass both domestic and international aspects. We evaluate your local and cross-border transactions within the group, analyzing their types and volumes. We assess the transfer pricing stance of each transaction type in light of local regulations and international practices.
These diagnostic reviews and health checks help identify and rectify gaps in accounting records, providing you with a clearer understanding of Transfer Pricing risks and strategies for effective compliance with relevant regulations.
We offer expert advice to our clients on all matters related to Transfer Pricing Transactions and inquiries. Our team can help you explore opportunities for enhancing tax efficiencies within your existing intra-group transactions. You can consult us for aligning your Transfer Pricing Policies with your business productivity goals.
Our Corporate Tax Advisors also provide guidance on Business Restructuring and Supply Chain Transformation in line with Transfer Pricing Policies. Our Tax Advisors are readily available to address your transfer pricing questions, tailored to your specific business needs.
We assist you in maintaining accurate documentation for Transfer Pricing Transactions to demonstrate your compliance with relevant regulations. Non-compliance can lead to disputes, so we analyze the type, volume, and complexity of both your domestic and international transactions to identify and address any Transfer Pricing issues.
Comprehensive documentation is crucial during a Transfer Pricing Audit, as Tax Authorities, Regulators, and Auditors may request these records. Failing to provide proper documentation could result in penalties or fines.
In line with OECD guidelines, entities should adopt a three-tiered approach for Transfer Pricing documentation:
Here are some common questions about Transfer Pricing Services
Transfer Pricing refers to the price set for transactions between related parties, whether they operate in the same jurisdiction or different ones. When a transaction occurs between a parent company and its subsidiary, or between two subsidiaries, the price charged by the seller is known as the Transfer Price. According to OECD Transfer Pricing Rules, these transactions must be treated as if they were conducted between independent, unrelated parties.
Imagine Company X and Company Y are independent entities. Company X sells a product to Company Y, generating revenue and a profit of AED 500,000. According to UAE corporate tax law, Company X would owe AED 2,500 in taxes on this profit.
Now, suppose Company Z is a subsidiary of Company X. When Company X sells the same product to Company Z, it prices the sale lower to reduce its profit, resulting in a profit of only AED 480,000. This adjustment means Company X’s tax liability is now AED 432.
Since Company Z is a related party, Company X discounts the price to lower its tax obligation. However, international transfer pricing regulations require that transactions between related parties be conducted at arm’s length prices.