SCOPE & APPLICABILITY
Transfer Pricing Regulations (“TPR”) are applicable to the all enterprises that enter into an ‘International Transaction’ with an ‘Associated Enterprise’. Therefore, generally it applies to all cross border transactions entered into between associated enterprises. It even applies to transactions involving a mere book entry having no apparent financial impact.
WHAT ISAN INTERNATIONAL TRANSACTION?
An international transaction is essentially a cross border transaction between AEs in any sort of property, whether tangible or intangible, or in the provision of services, lending of money etc. At least one of the parties to the transaction must be a non-resident entering into one or more of the following transactions
(a) Purchase, sale or lease of Tangible or Intangible Property
(b) Provision of services (c) Lending or borrowing of money
(d) Any transaction having a bearing on profits, income, losses or assets
(e) Mutual agreement between AEs for allocation/apportionment of any cost, contribution or expense.
METHODS OF DETERMINING THE ALP
(a) Comparable Uncontrolled Price Method (‘CUPM’)
(b) Resale Price Method (“RPM’)
(c) Cost plus method (‘CPM’)
(d) Profit Split Method (‘PSM’)
(e) Transactional Net Margin Method (‘TNMM’)
HOW GKCM CAN HELP YOU
We have a team of specialist in accounting, taxation & law. This combination of specialist enables us to deal all the transfer pricing matters is technical & innovative manner. We provide the following services related to international transactions:
- Accounting services
- Advice on all the relevant matters
- Transfer pricing certificate
- Transfer pricing study
- Transfer documentation etc.