Transfer pricing

Multinational organisations are operating in an environment of unprecedented complexity. The rising volume and variety of intercompany transactions and transfer pricing regulations, accompanied by increased enforcement activities worldwide have made transfer pricing a leading risk management issue for global businesses.

The goal of Deloitte member firms’ (Deloitte) globally-managed transfer pricing network is to help companies reduce risks by aligning practical transfer pricing solutions with their overall global business operations and objectives, assist with strategic documentation to support their transfer pricing practices, and resolve disputes efficiently. Deloitte has a well-earned reputation for quality and delivering results.

Our services include:

Transfer pricing planning and documentation
Dispute avoidance: Advance pricing agreements
Dispute resolution: Examination defence and mutual agreement procedure/competent authority
Business model optimisation

Transfer pricing planning and documentation

Multinational businesses are expanding the volume of related-party transactions and continuously improving supply chains. This coupled with increased tax authority collaboration across borders presents both risks and opportunities. Deloitte provides practical solutions such as strategically approaching transfer pricing documentation requirements, which enable global businesses to achieve operational and international tax planning objectives. For multi-country projects Deloitte has a Global Transfer Pricing Center, that includes economists, tax professionals and MBAs who have on-the-ground international transfer pricing experience and specialise in Europe, the Americas or the Asia Pacific region. This centralised, global approach facilitates uniformity of reporting and eliminates internal inconsistencies which can arise from multiple service providers, thereby making the process more effective and efficient and easier to successfully defend.

Dispute avoidance: Advance pricing agreements (APAs)

Transfer pricing presents many tax, legal and operational challenges. To many taxpayers the magnitude of uncertainties – including the potential commitment of management time to successfully defend a transfer pricing examination – is not an acceptable business risk. APAs allow taxpayers to proactively achieve greater certainty via advance agreements on their transfer pricing methods with one or more tax authorities. Deloitte’s experience with the APA process spans the entire history of all the national programs. Our historical knowledge of how to achieve successful results helps companies manage their transfer pricing issues – particularly the risk of double taxation – on a prospective basis.

Dispute resolution: Examination defence and mutual agreement procedure/competent authority (MAP/CA)

Missteps that affect the course or outcome of a transfer pricing examination often occur in responses to the initial tax authority enquiries and interviews. The most effective and efficient defences include early involvement of an experienced global team that has successfully resolved examinations at all possible levels of the process, from proposed adjustments by field agents, through Advance Pricing Agreement, administrative appeals, litigation and the MPA/CA process. Deloitte takes an integrated approach to resolving transfer pricing disputes in the MAP/CA process. Our teams include transfer pricing MAP/CA specialists from both countries teamed with professionals who specialise in local country requirements for indirect taxes, taxes imposed by local or state/provincial jurisdictions, international tax and interest calculations for late payment that invariably affect the outcome.

Business model optimisation (BMO)

The global economic environment is characterised by continuous improvements in technology, urgency to adopt and implement best practices and processes, and the potential for legislative changes. Assessing a multinational’s global business model is no longer an optional exercise. Business Model Optimisation (BMO) is the process of balancing the demands of operations and tax law and integrating them into the business model. This helps ensure tax planning does not curtail the bottom line and that the business model does not surrender some or all of the value it creates. Deloitte provides high quality, customised tax and BMO services that focus on helping multinationals integrate operational and tax planning in a scalable and sustainable way in order to enable business leaders to make more effective decisions on an after-tax basis.

Contacts

Stephan Tilquin
International Tax Partner

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Vecteurs de croissance au Luxembourg - Transfer pricing | Whitepaper
Definition of the basic principles of transfer pricing, its potential impact on the business, and the opportunities that it presents for companies activities.
Transfer pricing - optimising intercompany cross-border transactions | Brochure
Whether it concerns a transfer of goods, intangible property, the provision of services or financing arrangements, it all involves transfer pricing.
Press article: Evaluation des transactions de financement, mode d’emploi
Dans une circulaire de janvier 2011, l’Administration des contributions directes luxembourgeoise précise le traitement fiscal des transactions de financement intra-groupe, détaillant les règles et la méthodologie applicable en matière de prix de transfert
Press article: Les opérations de financement à l’heure du juste prix
Le Luxembourg a récemment émis une circulaire consacrée à la détermination des prix des transferts applicables aux entités luxembourgeoises exerçant des activités de financement intra-groupe.