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Robust transfer pricing structures

Question

 
Is it possible to design a robust transfer pricing structure that is compliant with regulations yet still efficient from a tax arbitrage perspective?
 

Answer

 
While there are important commercial factors to bring to the surface the answer is ‘yes’ – as long as there are different effective tax rates in the jurisdictions in which companies operate and as long as economic substance supporting the transfer pricing structure is in place. This requires a proactive planning approach in contrast to a reactive documentation led approach to transfer pricing policy. 
 
Recent case study
 
Many companies are responding to the changes in international transfer pricing regulations by allocating additional resources to the compliance effort to help defend against audits. This is an...

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