Transfer Pricing
Globalization and the continued expansion of international trade have made intercompany pricing an important factor for many businesses. In the era of fiscal shortfalls, tax authorities see transfer pricing (TP) adjustments as low-hanging fruit, especially with the impending OECD changes (e.g., Pillar One, Pillar Two). As a result, taxpayers must adjust to this uncertain environment by considering both their operations and potential aggressive scrutiny by the tax authorities.
With an ever-changing and complex global tax environment, taxpayers should take a proactive approach to evaluate and review their global TP arrangements to ensure ongoing compliance, appropriate economic substance, and global tax optimization/efficiency.
Our Expertise and Approach
Andersen’s TP practice can help you navigate through the complexities of the global transfer pricing landscape and proactively help you manage TP risks through the following service offerings:
TP Planning and Implementation
- Align related party transactions to a company’s growth trajectory and business objectives.
- Review intercompany agreements for alignment with transfer pricing best practices and business objectives.
- Assist Multinational Enterprises (“MNE’s”) with business restructurings and business evolution.
- Assess and align value of intellectual property (IP) with the business operations, including the valuation of IP for TP purposes to safeguard against tax authorities claiming that IP rights were transferred without reasonable compensation.
- Allocation of profits to permanent establishments.
- Assess financial transactions pricing (e.g., interest rates, guarantee fees, etc.).
- Assist with the implementation of TP policies into internal accounting systems and integration with data systems for reporting purposes.
TP Documentation and Compliance
- Prepare Canadian and OECD-compliant contemporaneous TP documentation.
- Perform economic/benchmarking analyses to determine an arm’s length return for your intercompany transactions.
- Assist in proper reporting of TP positions on tax returns, including the preparation of the various disclosure forms (e.g., T106 Forms, CbCR Form, etc.).
TP Reviews and Risk Assessments
- Review existing TP documentation to ascertain compliance with local country TP regulations.
- Review current intercompany transactions/TP policies and provide recommendations.
- Help in determining and quantifying TP exposures and uncertain tax positions.
TP Controversy and Dispute Resolution
- Assist in effective representation during a TP examination by tax authorities.
- Provide advice on effective appeal/defense strategies in the event of a proposed adjustment.
- Prepare, negotiate, and implement Advance Pricing Arrangements (APAs) and Mutual Agreement Procedures (MAPs) with tax authorities.
Other TP Advisory Services
- Serve in advisory role on M&A transactions, whether for the purchaser (acquisition financing, due diligence, post-deal phase) or the seller (pre-sale restructuring, post-phase).
- Equip your/tax/finance team with the requisite knowledge of TP and the associated risks that may impact your business.
Our Professionals
Patrick Coutu, CPA, D.Fisc.
Montreal
Partner
Danny Guérin, CPA, LL.M.Fisc.
Montreal
Partner
