Services

Tax

Transfer Pricing

What type of Service It is ?

Transfer pricing is an accounting practice that represents the price that one division in a company charges another division for goods or services provided.
A transfer price is based on market prices in charging another division, subsidiary, or holding company for services rendered.

What we provide ?

  1. Creating Transfer Pricing Documentation – The Transfer Pricing legislation requires that income from International Transactions between Associated Enterprises is computed after considering the arm’s length price. The term “Arm’s-length Price” refers to the price that would be charged for a similar International Transaction between unrelated third parties.
  2. The Transfer Pricing Documentation created by Fyient covers the various mandatory requirements under the law and includes:
    1. Background of the Company and its Associated Enterprises
    2. Functional Analysis to document the Functions, Risks and Assets deployed
    3. Industry Overview
    4. Comparability/Benchmarking analysis to prove the Arm’s Length nature of International Transactions entered into between Associated Enterprises
    5. Representing before Transfer Pricing Authorities – These services include representation before the designated Transfer Pricing Officers/Assessing Officers for Transfer Pricing related matters. The scope of services provided also covers representation before higher authorities like Commissioner of Income Tax etc.
    6. Other Value Added Services relating to:
      1. Planning Opportunities to achieve lower taxation for the group
      2. Assisting clients in Benchmarking vis a vis other players in the same industry
      3. Drafting of Inter-Company agreements, review of documentation, etc

Advantages of it ?

  1. Transfer pricing helps in reducing duty costs by shipping goods into countries with high tariff rates at minimal transfer prices so that the duty base of such transactions is fairly low. Transfer pricing can help an organization to identify opportunities for business optimization – transfer pricing analysis involve a deep understanding of how the group’s business works, its key value drivers, and hence could indicate ways of improvement and/or optimization  Transfer pricing helps in reducing the duty costs by shipping goods into high tariff countries at minimal transfer prices so that duty base associated with these transactions are low.
  2. Reducing income taxes in high tax countries by overpricing goods that are transferred to units in those countries where the tax rate is comparatively lower thereby giving them a higher profit margin.