Transfer pricing has become an area which is increasingly subject to inspections carried out by Czech tax offices. Tax payers who are not prepared for this can have difficulties providing answers to questions on transfer prices during a tax office inspection. As a result, significant shortcomings and risk areas may be identified. Having a clear idea about the situation your company is in regarding transfer pricing enables you to take appropriate measures in order to control risks and prosper from possible optimizations.

Our services

Identifying related parties and analyzing transactions between related parties

We would be pleased to offer you (1) a Transfer Pricing Risk Review or (2) a Transfer Pricing Analysis.

1. The aim of this service is to review the nature of a related party transaction and the applied transfer pricing approach and available documentation. The outcome of a Transfer Pricing Risk Review is a short report summarizing the issues identified – areas of exposure and potential savings.
2. The aim of this service is recommending the most appropriate way to manage the risks identified and the most appropriate transfer pricing methodology. The recommendations are based on a detailed analysis of comparable transactions and benchmarks, which gives the client maximum assurance that its transfer prices, applied according to our recommendations, would be acceptable to the Czech tax authorities. This detailed Transfer Pricing Analysis is performed using independent international databases.

Preparing transfer pricing documentation

In the course of a tax audit, a taxpayer is obliged to provide the Czech tax authorities with acceptable evidence of facts decisive for determination of the tax base. The Czech tax authorities therefore strongly recommend that the taxpayer has transfer pricing documentation prepared in accordance with the Code of Conduct on Transfer Pricing Documentation for Associated Enterprises in the EU, which is a common standard within the EU. The aim of this service is to prepare transfer pricing documentation for the client, which meets the requirements of Czech tax legislation as well as international transfer pricing standards.

Application for a Binding Ruling

According to Czech tax legislation, companies may request from Czech tax authorities a binding ruling over the transfer pricing issues arising from transactions conducted with related parties. We offer our clients assistance with the preparation and submission of the application for the binding ruling and support in negotiations with the Czech tax authorities.

Supply Chain Management

To ensure full competitiveness, companies’ business models need to be periodically reviewed with respect to contemporary global trends. By structuring the model using a supply chain management entity in a tax efficient structure, significant extra value can be achieved. We will assist you in reviewing your current business model and propose possible alternative structures to align tax to business and create a proper defence file for the Czech tax authorities.