Transfer Pricing for Industry & Services

How PwC can help

The Base erosion and profit shifting (BEPS) Action Papers 8-10 and 13 have had a fundamental impact on the way we document transfer pricing arrangements. Today, a full 3-dimensional view of the company is required for basic transfer pricing documentation. Not only the low-risk services sides of international transactions must be described in a functional analysis, but the full value chain of a company must be presented to give revenue authorities a satisfactory overview of the taxpayer. Master Files lay out a blueprint of a multinational company's value chain while giving an overview of their transfer pricing policies. Value Chain and transfer pricing policies should be aligned with Development, Enhancement, Maintenance, Protection and Exploitation (DEMPE) functions and economic substance to be sustainable. Local Files present the detailed local country results of a company's overall transfer pricing policy.

In addition, the recent economic and business disruptions have resulted in (i) changes of business models impacting operations, value chains, employment structure, etc., and (ii) enhanced digitalisation. Business restructurings, reduced liquidity and loss positions would require the use of new financial solutions and instruments, as well as additional funding. These changes could have a direct impact on the value chains, intercompany pricing and TP policies applied.

Our team of transfer pricing professionals can help you:

  • Value Chain Analysis for IC&S companies

  • Restructuring, profit alignment

  • Functional analysis

  • Benchmarking studies

  • Entities remuneration

  • PE analysis and profit allocation

  • Three-tiered approach, i.e. Master File, Local Files, and Country-by-Country Report ("CbCR")

  • Intercompany support services


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