UK transfer pricing risk assessment queries and audits are on the increase due to pressure from Parliament, NGOs and the national media. In addition, we are seeing an increase in attempts from HMRC to apply discovery assessments to challenge prior years’ transfer pricing (due in part to the rapidly changed landscape and the potential for different views as to what constitutes an appropriate transfer price). However, the requirement for increased transparency (for example through country by country reporting) and case law precedents can provide businesses with a strong opportunity to mitigate transfer pricing adjustment risk to open years in isolation.
