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1
Šangić, Bojana, and Jelena Obradović. "Transfer pricing: Guidelines and methods." Revizor 21, no. 84 (2018): 45–60. http://dx.doi.org/10.5937/rev1884033s.
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Khris, Barnes, and Messina Whiteside. "Transfer Pricing: Purpose of Determination and Factors Affecting Transfer Pricing Determination." Journal Dimensie Management and Public Sector 1, no. 2 (December 23, 2020): 27–34. http://dx.doi.org/10.48173/jdmps.v1i2.48.
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The study discusses several things, including the factors that influence the determination of transfer pricing and the methods used in determining transfer pricing. Factors that influence transfer pricing include tax considerations, dance calculations, competitive factors, environmental risk, calculation of performance appraisals and accounting contributions. The method used in determining transfer pricing. Methods in determining transfer pricing include traditional methods, traditional methods consist of several ways including the comparable uncontrolled price method, cost-plus method, and resale price method. Transactional profit method: split profit and transactional net margin method.
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Pogorelova, Lioubov. "Trade and Transfer Pricing." Intertax 40, Issue 1 (January 1, 2012): 33–53. http://dx.doi.org/10.54648/taxi2012004.
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Although there may be difficulties, especially during challenging economic times, in applying profit-based regulations when an income tax dimension is considered, if a trade dimension is introduced, in some circumstances profit-based methods, such as the comparable profits method (CPM) or transactional net marginal method (TNMM), may be preferred transfer pricing methods for multinationals. The article provides a comprehensive overview of the profit-based methods CPM and TNMM, where advantages and disadvantages of these methods are considered, and differences between these two methods are pointed out. The article also introduces a conceptual framework for transfer price coordination in the context of income tax and customs laws and examines issues pertaining to harmonization of income tax and customs laws.
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Berroho, Mohamed El Bachir. "US , OECD , or U.N. Transfer Pricing Methods." مجلة الفقه و القانون, no. 18 (April 2014): 300–305. http://dx.doi.org/10.12816/0005130.
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Dewi Astuti, Melani. "Country Note: Implementation of BEPS Recommendations in Indonesia’s New APA and Transfer Pricing Rules." Intertax 48, Issue 12 (November 1, 2020): 1145–54. http://dx.doi.org/10.54648/taxi2020114.
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Indonesia has recently updated its Advance Pricing Agreement and transfer pricing regulations in order to capture the development in the business and transfer pricing. It is also aimed to align with the Base Erosion and Profit Shifting (BEPS) recommendations. The new regulation has made substantial changes to the old advance pricing agreements (APAs) and transfer pricing regulations. With regards to transfer pricing, the new regulation has made some changes pursuant to the related parties’ definition, transfer pricing methods, comparability analysis procedures, special transactions, and intangibles. The transfer pricing guidance also provides guidance on the financial transactions and introduces the value creation concept. The new definition of related party is broader by providing more example on the ownership based on control. The regulation also allows the use of other transfer pricing methods other than the five OECD methods. Moreover, the intangible provisions have been modified to reflect the changes in the OECD Transfer Pricing Guideline 2017, to cover development, enhancement, maintenance, protection, and exploitation (DEMPE) activities and the economic owner. The guidance on financial transaction could also be useful for taxpayers and tax administration. Meanwhile, in terms of APA, the new regulation has provided a longer period of APA implementation, included a roll-back provision and modified the requirements regarding the submission of APA. Based on the new APA regulation, to submit an APA, a taxpayer cannot propose a lower profit than profit reported in the tax return. In general, the new regulation is in line with the BEPS 8-10 recommendations, albeit some differences are found, those are considered minor. The new regulations are expected to provide more certainty and simplicity for the taxpayers. Transfer pricing, APAs, Indonesia, advance pricing agreement, transfer pricing guidance, roll-back, related party, affiliated, transfer pricing methods, comparables
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Zielke, Rainer. "Transfer Pricing Planning with Accuracy and Control." Intertax 41, Issue 10 (October 1, 2013): 542–50. http://dx.doi.org/10.54648/taxi2013050.
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Traditionally the Comtax® System provides not only current in-depth information on numerous national systems of taxation, but also quantifies crossborder payment transfers, and thus allows both a quick access on relevant detail knowledge and a direct comparison of different scenarios. This has now been upgraded by the new Comtax solution for transfer pricing were the arm's length principle, the definition of related companies, transfer pricing methods, business restructuring and dispute resolution are taken into consideration. The theory of international tax planning provides objectives and concepts of international tax planning and demands expertise in current and reliable information - also on transfer pricing. Comtax® System and Comtax® TP Tool are now jointly able to cover all aspects of international tax planning.
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Avtukhova, Elena. "Transfer pricing as a company management tool." Moscow University Economics Bulletin, no. 2 (April 30, 2021): 49–72. http://dx.doi.org/10.38050/01300105202123.
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This article studies one of the most complicated and yet popular company management tools, the transfer pricing. The author considers the aims and purpose of transfer pricing, the formation of a transfer pricing system as a company management tool, popular viewpoints on transfer price calculation methodologies, strengths and weaknesses of the existing approaches, and offers a hypothesis on transforming transfer pricing methods. The paper systematizes transfer pricing methods with due regard to the experience of domestic and foreign companies, the development of the Russian Federation legislation, the recommendations of the OECD, and the studies of auditing and consulting companies. The author presents an overview of the most popular transfer pricing methods which serve as a basis for using one or another method, identifies the factors of efficient management mechanism. The article analyses the specific features of using a particular management mechanism in financial companies and companies operating in real economy, studies the methodology to deploy transfer pricing in a legal entity and within a vertically integrated holding. Taking into account the fact that regulation of transfer pricing is also a tax regulation tool used by the state, the author emphasizes that the problems of transfer pricing tools aimed at tax risk management are not the object of the article. The results of the study can be used by employees and executives of corporate financial divisions, analysts, consultants, and employees of state agencies and authorities while developing the methodology for using financial instruments in company management.
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Iryna, HLADIY. "TRANSFER PRICING OF TRANSNATIONAL CORPORATIONS." Foreign trade: economics, finance, law 116, no. 3 (June 15, 2021): 85–97. http://dx.doi.org/10.31617/zt.knute.2021(116)08.
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Background. In the context of globalization, transnational corporations have turned into highly concentrated points of the world economy and the principal markets for goods and services. It is under such conditions that a comprehensive research of the pricing system within the framework of their activities is relevant. Analysis of recent research and publications has revealed that the process of setting prices for products within their activities in different countries and the development of innovations in domestic legislation require in-depth study. The aim of the article was to study possible transfer pricing systems for TNCs in order to eliminate risks when calculating the exact cost of products and avoid possible situations of non-payment of due taxes. Materials and methods. A set of general scientific methods of cognition is applied: inductive, deductive, system analysis, theoretical generalization, formal-logical, analysis and synthesis. Results. The transfer pricing system is becoming the key direction in the process of planning and profit maximization. The methods of setting the transfer price are legally enshrined in the current Tax Code of Ukraine. However, the use of these methods is a top priority for checking compliance with the «arm’s length»principle. It is determined that in order to comply with this principle, it is necessary to compare controlled and uncontrolled transactions, based on the criterion of tax benefits, as well as to analyse all the advantages and disadvantages that they create. Conclusion. The issue of proper transfer pricing plays a leading role in the export or import of goods. Particular attention should be paid to the sources of information indicated by taxpayers and used in order to ensure compliance with the requirements for justification in the documentation on transfer pricing compliance with the conditions of controlled transactions with the arm’s length principle. Prospects for further research are to provide practical recommendations for compliance of the legal and regulatory framework for transfer pricing with the requirements of the world economy in the direction of preventing the implementation of tax avoidance schemes.
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Ребров, С., and S. Rebrov. "Transfer Pricing System Based on the Method of Cash Flows Redistribution." Scientific Research and Development. Economics of the Firm 8, no. 3 (October 11, 2019): 67–74. http://dx.doi.org/10.12737/article_5d7b57d7b27e93.37859360.
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The article describes the system of transfer pricing based on the method of cash flows redistribution, developed by the author. The article describes such concepts as transfer price, transfer pricing, transfer pricing system. Methodological tools of research: analysis, synthesis, system approach. The author used the method of cash flows redistribution, the description of which is given in this article. The transfer pricing system developed by the author is based on the determination of the transfer price interval on the basis of the transfer pricing methods allowed by tax law, as well as the average value of this interval. This average value can be considered as the average market price, which is determined by the specifics of transfer pricing methods. If there is a deviation from the average market price, there is a redistribution of funds between the subjects of the transaction. For the control of transfer price introduced the coefficient of cash flows redistribution. To manage the transfer pricing system, a matrix of cash flow redistribution coefficients was introduced, as well as the account "redistributed funds". The positive and negative consequences of the introduction of this system of transfer pricing are considered.
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Gargouri, Slim. "Transfer Pricing in North African Countries." Intertax 42, Issue 4 (April 1, 2014): 290–92. http://dx.doi.org/10.54648/taxi2014029.
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In North African region, Only Egypt and Algeria have already implemented a Transfer Pricing regulation: Egypt introduced the concept in 2005 while the Algerian rules were implemented in 2007. Though, the measures in force are still under the urgent requirement to be improved: The Egyptian case shall focus on the transfer pricing documentation while Algeria has to further develop transfer pricing methods as well as to authorize the conclusion of Advance Pricing Agreement (APA). Tunisia and Morocco have not introduced transfer pricing rules yet, but they require that transactions between related entities should be performed in compliance with the arm's length principle.
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Challoumis, Constantinos. "Transfer Pricing Methods for Services and the Policy of Fixed Length Principle." Economics and Business 33, no. 1 (January 1, 2019): 222–32. http://dx.doi.org/10.2478/eb-2019-0016.
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Abstract The paper deals with the methods used by companies for controlled transactions in services. The author performs an analysis of the ways a company that takes part in controlled transactions of transfer pricing can tackle tax issues using an adequate tax method. Services should comply with the arm’s length principle. Therefore, the best method rule and the comparability analysis have a critical role in the arm’s length principle of services. The paper compares the results of transfer pricing services with the transfer pricing of goods to conclude the similarities. The object of the paper is to determine the importance of the application of fixed length principle, meaning the application of additional tax for controlled transactions and declined tax for uncontrolled transactions. Therefore, this scrutiny showed that the unstable tax environments force enterprises to proceed to controlled transactions.
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Steyn, M. "Transfer pricing methods in the context of intangible property." South African Journal of Accounting Research 18, no. 1 (January 2004): 43–64. http://dx.doi.org/10.1080/10291954.2004.11435108.
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Krutova, A., O. Nesterenko, and M. Levina. "Transfer pricing as a means of the state tax base optimization." Fundamental and applied researches in practice of leading scientific schools 31, no. 1 (February 28, 2019): 100–107. http://dx.doi.org/10.33531/farplss.2019.1.21.
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This study is aimed at development of the theoretical foundations of transfer pricing mechanism implementation at Ukrainian enterprises.
Methods. The article uses processed by analytical alignment data of pricing methods analysis. Achievement of the objectives was carried out with help of general and special research methods, namely: dialectical approach, analysis and synthesis, systematization and generalization
Results. Developed classification of pricing models is presented in this research with separation of the transfer pricing methods group, which are an effective tool of international tax planning transparency increasing, taxation stability ensuring and eliminating the possibility of moving profits to other tax jurisdictions. Transfer price formation stages matrix is developed which divides transfer pricing process on five stages: data collection, functional analysis, economic analysis, accounting procedures, reporting. The study tested the possibility of implementation in Ukraine of steps 8-10 of the BEPS plan as relevant for solving problems caused by tax base erosion.
Conclusions. Developed in the article matrix of the transfer price formation stages will contribute to effective implementation of BEPS steps relating to pricing control.
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Pogorelova, Lioubov. "Grey Markets and Transfer Pricing." Intertax 38, Issue 11 (November 1, 2010): 588–600. http://dx.doi.org/10.54648/taxi2010062.
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This article proposes transfer pricing strategies to help multinationals alleviate the problem of grey markets by introducing the tax dimension to pricing decisions of companies. This article not only explores strategies that involve direct transfer price adjustments through the comparable uncontrolled price (CUP) method but also examines alternative strategies using indirect adjustments to a transfer price through the resale price and cost plus methods when the effects of both price arbitrage and tax arbitrage are considered.
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Kubjatkova, Anna, and Anna Krizanova. "Transfer pricing in the conditions of the Slovak Republic." SHS Web of Conferences 129 (2021): 08010. http://dx.doi.org/10.1051/shsconf/202112908010.
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Research background: All of the world’s economic relations in today’s world are subject to the process of globalization. Increasingly, the economic activity of many entrepreneurs transcends national borders, often operating in the form of multinational companies. Through the Transfer Pricing Institute, multinational companies can transfer their pre-tax profits from one country to another, and this phenomenon often harms the affected countries, which can result in lower tax revenues and a deterioration in the balance of payments. Transfer pricing generally seeks to prevent similar shifting of profits and thus prevent possible tax evasion. Purpose of the article: The aim of this article is primarily to summarize the knowledge and procedures of transfer pricing and its importance in the conditions of the Slovak Republic. The article also aims to explain to the general public why transfer pricing is important and necessary for a healthy economy. Methods: In this work, the methods of induction, deduction, and comparison were used to obtain a true picture of the issue of transfer pricing. Methods of synthesis and analysis of the researched issues were also used. Findings & Value added: In addition to a general overview of this issue, we consider the result of this work to summarize the legislative framework of transfer pricing and also provide a brief and clear example of the transfer of profits in transfer pricing between two and within one country and their impact on the country’s economy.
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Valente, Piergiorgio. "Italy: An Outlook on the Supreme Courts Transfer Pricing Decisions." Intertax 41, Issue 4 (April 1, 2013): 256–63. http://dx.doi.org/10.54648/taxi2013022.
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Transfer pricing litigation in Italy is becoming increasingly common. Notwithstanding the increasing interest in the above area, Italy has yet to establish a consolidated approach, particularly concerning issues such as the burden of proof, the qualification of transfer pricing rules, documentation requirements and proper transfer pricing methods.
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Limberg, Stephen T., John R. Robinson, and Raimundo L. M. Christians. "International transfer pricing restrictions: impact on corporate financial policy." Revista de Administração de Empresas 37, no. 3 (September 1997): 28–41. http://dx.doi.org/10.1590/s0034-75901997000300005.
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Transfer pricing is a pervasive issue that presents significant tax savings potential concerning international enterprises. The authors discuss company incentives to manage transfer prices in an article appearing in the preceding issue of this journal. In response to these incentives, governments have increasingly enacted and enforced domestic restrictions on transfer prices. In this article, contemporary norms restricting transfer pricing are analyzed. The OEGO and US pricing standards are assessed and Brazil's recent application of these standards is considered. Transfer pricing methods are described and evidence of their use is presented. We conclude by describing an intercompany transfer pricing policy intended to facilitate internaI financiaI management and minimize externaI tax threats.
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Podstawka, Marian. "Transfer Prices and Aggressive Tax Optimization." Economic and Regional Studies / Studia Ekonomiczne i Regionalne 12, no. 3 (September 1, 2019): 242–53. http://dx.doi.org/10.2478/ers-2019-0022.
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SummarySubject and purpose of work: The subject of this study is transfer prices and their use for optimization of financial burdens of international companies (capital groups). The purpose of this study was to present transfer pricing issues in the light of applicable law and using them for tax purposes.Materials and methods: The study uses literature and data from the World Bank and Google. Methods of descriptive and tabular analysis and inference were used.Results: Google makes 91% of its revenues outside the US.Conclusions: Transfer pricing is a tool for optimizing tax burden of international companies that bring them benefits in the form of the so-called “globalization annuity”, which makes them economically stronger and more technologically competitive. Polish tax law on transfer pricing has been tightened since 2001; transfer pricing issues are also regulated by the European Union and the Organization for Economic Cooperation and Development (OECD).
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Khasanova, Risolat. "ANALYSIS OF THE METHODS OF FORMATION OF THE TRANSFER PRICE AND THE POSSIBILITY OF ITS IMPLEMENTATION IN THE PERFORMANCE OF BUSINESS ENTITIES." INNOVATIONS IN ECONOMY 4, no. 7 (July 30, 2021): 20–27. http://dx.doi.org/10.26739/2181-9491-2021-7-2.
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The article examines the experience of transfer pricing in world practice. In particular, the option of using an alternative transfer pricing scenario was considered. It was determined the need to include the profits of each division in the calculation sheet of the cost of production as a separate item. The possibilities of introducing this experience into the process of forming transfer pricing of enterprises operating in the form of clusters and cooperatives are analyzed. As a result of the study, conclusions were formed, scientific proposals and practical recommendations were given on this problem.
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Perčević, Hrvoje, and Mirjana Hladika. "Application of transfer pricing methods in related companies in Croatia." Economic Research-Ekonomska Istraživanja 30, no. 1 (January 2017): 611–28. http://dx.doi.org/10.1080/1331677x.2017.1305779.
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Romaniuk, Maciej. "Pricing the Risk-Transfer financial Instruments via Monte Carlo Methods." Systems Analysis Modelling Simulation 43, no. 8 (August 2003): 1043–64. http://dx.doi.org/10.1080/0232929031000150382.
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Solilová, Veronika. "Transfer pricing rules in EU member states." Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis 58, no. 3 (2010): 243–50. http://dx.doi.org/10.11118/actaun201058030243.
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One of the important area of international taxes is transfer pricing. Transfer price is a price set by a taxpayer when selling to, buying from, or sharing resources with a related (associated) person. The transactions between these persons should be assessed at their arm’s length price in according the arm’s length principle – international accepted standard – as the price which would have been agreed between unrelated parties in free market conditions. This paper is focused on the tranfer pricing rules used in particular EU Member States so as if EU Member States apply the arm’s length principle, define the related persons, apply recommendations of the OECD Guidelines, use the transfer pricing methods, require TP Documentation, exercise specific transfer pricing audit or impose specific penalties and apply APAs. Transfer pricing rules should prevent taxpayers from shifting income to related person organized in tax havens or in countries where they enjoy some special tax benefit.
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Novira, Anggun Rizki, Leny Suzan, and Ardan Gani Asalam. "Pengaruh Pajak, Intangible Assets, dan Mekanisme Bonus Terhadap Keputusan Transfer Pricing." Journal of Applied Accounting and Taxation 5, no. 1 (March 31, 2020): 17–23. http://dx.doi.org/10.30871/jaat.v5i1.1852.
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Transfer pricing is the price for the delivery of goods, services, or other intangible assets at related parties transact with each other based on the arm’s lenght principle. The purpose of this study to examine the influence factors of tax, intangible assets, and bonus mechanism on transfer pricing decisions. The population in this study are mining sector companies listed on the Indonesian Stock Exchange from 2015-2018. Sample selection technique used in purposive sampling and acquired 13 sample companies. The data used in this study was obtained from financial statement. Methods of data analysis in this research in logistic regression analysis using SPSS software version 23. The result showed that simultaneous tax, intangible assets, and bonus mechanism have a significant effect on transfer pricing decision. Tax partially have no significant effect on transfer pricing decision, while intangible assets has a significant positive effect on transfer pricing, and bonus mechanism have no significant effect on transfer pricing decision.
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Arham, Amardianto, Amrie Firmansyah, and Aji M. Elvin Nor. "Penelitian Transfer Pricing di Indonesia: Sebuah Studi Kepustakaan." JURNAL ONLINE INSAN AKUNTAN 5, no. 1 (June 25, 2020): 57. http://dx.doi.org/10.51211/joia.v5i1.1318.
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Abstrak: Penelitian ini bertujuan untuk melakukan pemetaan atas berbagai hasil penelitian terkait transfer pricing di Indonesia dan memberikan rekomendasi agenda riset transfer pricing di masa depan. Pemetaan dilakukan berdasarkan tingkat topik penelitian, metode penelitian, variabel penelitian, dan hasil pengujian. Penelitian ini menggunakan metode kualitatif dengan pendekatan bibliografi. Objek yang digunakan dalam penelitian ini yaitu sebanyak 41 artikel hasil penelitian yang diterbitkan oleh jurnal yang telah terakreditasi SINTA atau terindeks Scopus sejak tahun 2000 sampai dengan awal tahun 2020. Hasil penelitian menunjukkan bahwa mayoritas tingkat topik penelitian yang paling banyak dibahas yaitu determinan transfer pricing. Sebagian besar penelitian menggunakan metode kuantitatif. Mayoritas penelitian kuantitatif menggunakan transfer pricing aggressiveness sebagai variabel dependen. Sebagian besar penelitian kuantitatif menggunakan tiga variabel independen yaitu, pajak, tunneling incentive, dan mekanisme bonus. Mayoritas hasil pengujian atas pengaruh pajak dan tunneling incentive terhadap transfer pricing aggressiveness menunjukkan pengaruh positif, sedangkan mayoritas hasil pengujian atas pengaruh mekanisme bonus menunjukkan tidak ada pengaruh.
Kata kunci: Transfer Pricing, Penelitian, Indonesia.
Abstract: This study aims to map various research results related to transfer pricing in Indonesia and and provide recommendations on the transfer pricing research agenda in the future. Mapping is based on the research topics, research methods, research variables, and test results. This study uses a qualitative method with a bibliographic approach. The objects used in this study are 41 research articles published by SINTA accredited journals or Scopus indexed since 2000 until early 2020. The results show that the most discussed research topics are determinants in transfer pricing. The majority of quantitative studies use transfer pricing aggressiveness as dependent variable. Most quantitative studies use three independent variables namely, taxation, tunneling incentives, and bonus mechanisms. The majority of testing results on the effect of taxation and tunneling incentives on transfer pricing aggressiveness show a positive effect, while the majority of test results on the effect of the bonus mechanism show no effect.
Keywords: Transfer Pricing, Research, Indonesia.
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Solilová, Veronika. "Revised OECD Transfer pricing Guidelines and the Czech tax policy." Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis 59, no. 4 (2011): 301–8. http://dx.doi.org/10.11118/actaun201159040301.
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In applying the international principles to the taxation of Multinational Enterprises, one of the most difficult issues that have arisen is the establishment for tax purposes of appropriate transfer prices. Transfer prices are significant for both taxpayers and tax administrations because they determine in large part the income and expenses, and therefore taxable profits, of associated enterprises in different tax jurisdictions. The Committee on Fiscal Affairs, which is the main tax policy body of the OECD, has issued a number of reports relating to the transfer pricing issues. The most important are the Transfer pricing Guidelines for multinational enterprises and tax authorities which was published in 1995. These Guidelines focus on the application of the arm’s length principle to evaluate the transfer pricing of associated enterprises, the analysis of the methods for evaluating whether the conditions of commercial and financial relations within Multinational Enterprises satisfy the arm’s length principle and discussion of the practical application of those methods. Simply, these Guidelines focus on the main issues of principle that arise in the transfer pricing area. The Committee on Fiscal Affairs continues its work in this area, on 22 July 2010 approved and released the proposed revisions to Chaps. I through III of these Guidelines and simultaneously published a new Chap. IX related to business restructuring. The revisions are the result of several years of work on comparability and the use of profit-based methods. The revised text will have a significant impact on the application of transfer pricing analysis and transfer pricing methods. The paper is focused on significant changes of newly approved Guidelines with aim to evaluate how the Czech Republic began applying the principles set out in the revised text of these Guidelines.
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KURILOV, YEVHEN. "INTERNATIONAL EXPERIENCE IN PROCESSING AND ASSESSMENT BY REGULATORY AUTHORITIES OF TRANSFER PRICING RISKS." HERALD OF KHMELNYTSKYI NATIONAL UNIVERSITY 296, no. 4 (June 2021): 156–62. http://dx.doi.org/10.31891/2307-5740-2021-296-4-25.
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The article analyzes and summarizes the international experience of regulatory authorities in dealing with transfer pricing risks as one of the basic elements of tax control over taxpayers’ compliance with transfer pricing rules. An efficient process for processing and assessing transfer pricing risks helps to ensure quality selection and increase the effectiveness of audits of controlled transactions, increase the efficiency of the use of limited resources, as well as greater tax certainty and reduce the number of unreasonable audits. As a result of the study: international experience was summarized and an indicative process of processing and assessing transfer pricing risks was determined; the main points of the general approach to the issue of transfer pricing risks, which are currently used in practice by the regulatory authorities of economically developed countries, have been identified; the principles of transfer pricing risk management were determined and the importance of carrying out transfer pricing risk assessment processes on an ongoing and systematic basis was indicated; the approaches to organizing the processing and risk assessment of transfer pricing proposed by the specialists of the OECD, JTPF and the UN are considered. Also, the author of the article proposed to supplement this process with a fifth post-assessment stage, which should include the following three steps (13-15): internal inspection and quality control of risk assessment processes based on the results of transfer pricing audits; improving the list of transfer pricing risk indicators and descriptions of their features and identification methods; training and professional development of specialists in the assessment of transfer pricing risks. In addition, attention was drawn to the need for proper documentation of the processing and risk assessment of transfer pricing. The article also concludes that the processes of processing and assessing transfer pricing risks should be integrated into the processes that are carried out within the framework of the functioning of the general risk management system of both the tax authority and any modern large enterprise (group of enterprises).
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McGowan, Carl B., David Beauregard, and Henry W. Collier. "Transfer Pricing And The Multinational Corporation." Journal of Applied Business Research (JABR) 3, no. 2 (October 31, 2011): 64. http://dx.doi.org/10.19030/jabr.v3i2.6534.
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This paper discusses the three major methods of determining the transfer price for goods traded within a multinational firm the comparable uncontrolled price method, the resale price method, and the cost plus method. In addition to tax considerations, five other factors affecting transfer pricing are discussed foreign government considerations, funds positioning effects, fluctuating foreign currency, foreign import duties, and performance evaluation. Finally, a detailed example of applying the resale price method is provided. Since this is the most difficult method to apply, this example is of particular use to small firms with limited experience in transfer pricing.
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KRUGLIAK, VIACHESLAV. "RISK INDICATORS OF TRANSFER PRICING ACCORDING TO THE DOCUMENTS OF INTERNATIONAL ORGANIZATIONS AND WAYS OF THEIR FURTHER USE." HERALD OF KHMELNYTSKYI NATIONAL UNIVERSITY 296, no. 4 (June 2021): 59–65. http://dx.doi.org/10.31891/2307-5740-2021-296-4-9.
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The article discusses the issue of establishing a list of transfer pricing risk indicators and determining further ways to use them. The problem of defining and using indicators of transfer pricing risks is relevant and has only recently begun to be discussed by experts in the field of international taxation and in academia. In fact, this category was not study as a separate category of indicators of tax risks, but was only considered in general terms as one of the types of tax risks. The study identified documents from international organizations that consider transfer pricing risks as a separate category of tax risks, as well as an element of tax control over taxpayers’ compliance with transfer pricing rules. On the basis of these documents, which summarize the international practice of transfer pricing, an indicative list of transfer pricing risk indicators has been studied and formed and recommendations have been developed on how to further use it by the tax authorities of Ukraine. The definition in this article of an indicative list of transfer pricing risk indicators in accordance with the documents of international organizations is an important prerequisite for understanding further steps to improve the domestic transfer pricing tax control system as a risk-oriented system. The author to suggested to using this list in the future for development and / or creation: a national indicative list of transfer pricing risks indicators and a domestic system for classifying and assessing such risks; standardized processes for identifying and processing information about potential transfer pricing risks and their integration into standardized processes of the general system for processing tax risks in the State Tax Service of Ukraine; determination methods (guidelines) and training materials on this issue; processes for selecting taxpayers for audits and evaluating the results of transfer pricing audits, and the like.
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Geboers, A. A. P. C., E. O. Uliana, and P. B. Dugmore. "An exploratory survey of transfer pricing in selected South African listed companies." South African Journal of Business Management 20, no. 1 (March 31, 1989): 27–31. http://dx.doi.org/10.4102/sajbm.v20i1.936.
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The use of transfer pricing among certain sectors of the JSE is investigated by means of a questionnaire survey. Information regarding the transfer pricing methods used and the management control systems applicable to those prices was requested. Where appropriate, comparison with similar studies carried out in other countries was made. Findings are largely in keeping with the position generally suggested by the literature. However, one particularly interesting difference between this study and comparable surveys carried out overseas is that in South Africa the minimization of tax is ranked relatively lower as an objective of the transfer pricing system. Another notable finding is that while transfer pricing among the companies that indicated they were using it, appears to be at a sophisticated level, a large proportion of the companies surveyed indicated that they did not use transfer pricing even though they could have been expected to be operating on a decentralized basis.
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Sahay, Savita A. "Tradeoffs Between Specific Investment and Optimal Resource Allocation: A Comparison of Different Transfer Pricing Policies." Accounting and Finance Research 7, no. 3 (August 4, 2018): 221. http://dx.doi.org/10.5430/afr.v7n3p221.
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This paper uses a principal-agent framework to analyze the tension between incentives for specific investment by the agent, and resource allocation that is optimal from the principal’s perspective. The analysis considers a decentralized firm in which central management can institute different transfer pricing policies to motivate divisional managers to undertake investment and production decisions. Some well-known properties of the methods are identified: a transfer price that uses a markup over and above actual costs can provide investment incentives but leads to sub-optimal resource allocation; negotiated transfer pricing suffers from the problem of under-investment even though its ex post performance is optimal; and standard cost-based transfer pricing entails over-reporting of standards, which results in inefficient levels of trade as well as low investment. The paper establishes a clear ranking amongst the three methods studied. It is shown that the overall performance of actual cost-based transfer pricing is superior if the buying division’s investments are important, while negotiated transfer pricing dominates if those of the selling division are important. The overall performance of standard cost-based method is inferior to that of the actual cost-based method, even though the latter has weaker investment incentives.
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Myring, Mark J., and Robert Bloom. "International Transfer Pricing and Intellectual Property: The PrimeCo Case." Issues in Accounting Education 22, no. 4 (November 1, 2007): 769–74. http://dx.doi.org/10.2308/iace.2007.22.4.769.
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This case introduces students to issues related to international transfer pricing for intellectual property. PrimeCo is a manufacturer of cellular telephone (cell phone) components. The firm has invested extensively in research and development activities. As a result, it has received many patents for innovative cell phone parts. PrimeCo recently established a subsidiary (SubCo) to manufacture its products for the Asia-Pacific region. The establishment of SubCo raises many difficult questions. Specifically, students are asked to address issues related to modes of entry into foreign markets, methods of transfer pricing in royalty arrangements, tax laws underlying transfer pricing, and ethical aspects of applying transfer prices.
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Istiqomah and Baihaqi Fanani. "Pengaruh Mekanisme Bonus, Tunneling Incentive, dan Debt Covenant Terhadap Transaksi Transfer Pricing." Permana : Jurnal Perpajakan, Manajemen, dan Akuntansi 12, no. 1 (February 29, 2020): 56–66. http://dx.doi.org/10.24905/permana.v12i1.93.
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The Effect of Bonus Mechanisms, Tunneling Incentive and Debt Covenant on Transfer Pricing Transactions. (Empirical Study of Manufacturing Companies Listed on the Indonesia Stock Exchange in 2014-2018).This study aims to determine the effect of bonus mechanism, tunneling incentive and debt covenants on transfer pricing transactions in manufacturing companies listed on the Indonesia Stock Exchange in the period of 2014-2018.The sample of this research is manufacturing companies listed on the Indonesia Stock Exchange in the period 2014-2018. By using purposive sampling method which consists of 6 companies. The data used in the form of financial statements with multiple regression analysis methods are processed using SPSS 23. The results of the study that the bonus mechanism affected the transfer pricing transaction with a significant value of 0.002, tunneling incentive affected the transfer pricing transaction, with a significant value of 0.004 and the debt covennat had no effect on the transfer pricing transaction with a significant value of 0.153.
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Mura, Alessandro, Clive Emmanuel, and Francesco Vallascas. "Challenging the reliability of comparables under profit-based transfer pricing methods." Accounting and Business Research 43, no. 5 (October 2013): 483–505. http://dx.doi.org/10.1080/00014788.2013.798581.
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Radzhabov, Ruslan. "Risk-oriented approach in tax administration of transfer pricing in Russia." Налоги и налогообложение, no. 3 (March 2021): 66–72. http://dx.doi.org/10.7256/2454-065x.2021.3.35378.
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The protection of the sovereign tax base and determination of the “fair share of profit” that should be attributed to a particular jurisdiction remains one of the topical issues in Russia and worldwide. The instruments for determining fair profit include the mechanism of transfer pricing designated for calculating company profit of (member of corporate group) based on an analysis of the actual economic circumstances of making a transaction, i.e. the assets, functions and risks of the parties to the controlled transaction (leaning on the modeling of market prices using the methods of transfer pricing). Analysis is conducted on the risk-oriented approach in tax administration of transfer pricing in the Russian Federation. The scientific novelty consists in systematization of the approaches towards tax administration of transfer pricing and formulation of recommendations for improving the efficiency of current processes. The analysis of the practice of tax administration of transfer pricing and the corresponding case law indicates that in assessing the adequacy of prices in controlled transactions to the market level, the tax authorities apply the so-called “risk-oriented” approach aimed at determination of the segments/market participants/transactions with the highest risk of transfer pricing. The implementation of risk-oriented approach requires the development of risk profiles of transfer pricing, which, depending on the analyzed segment or subject matter of transaction, represent a list of tax control measures and circumstances (risk factors) that allow concluding on the presence of transfer pricing risk in such transaction. The practical importance of this research consists in the possibility of using the results the acquired results by the government bodies that carry out the functions of administering transfer pricing, as well as by the organizations that use transfer prices as the tax planning instrument.
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Gujarathi, Mahendra R. "GlaxoSmithKline Plc.: International Transfer Pricing and Taxation." Issues in Accounting Education 22, no. 4 (November 1, 2007): 749–59. http://dx.doi.org/10.2308/iace.2007.22.4.749.
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This comprehensive case intends to develop your understanding of the complexities involved in the international transfer pricing and taxation of intangible assets. The backdrop for the case is GlaxoSmithKline's $5.2 billion settlement in 2006 with the U.S. Internal Revenue Service. You are required to provide possible rationales for the positions advocated by the Company as well as the IRS. You are also required to present calculations under different transfer pricing methods, identify the most appropriate method, compute Foreign Tax Credits for different scenarios, and suggest possible strategies for multinational corporations to reduce the odds of negative settlements with tax authorities.
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Barker, Joel, Kwadwo Asare, and Sharon Brickman. "Transfer Pricing As A Vehicle In Corporate Tax Avoidance." Journal of Applied Business Research (JABR) 33, no. 1 (December 27, 2016): 9–16. http://dx.doi.org/10.19030/jabr.v33i1.9863.
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Using transfer pricing, U.S. Corporations are able to transfer revenues to foreign affiliates with a lower corporate tax rates. The Internal Revenue Code requires intercompany transactions to comply with the “Arm’s Length Principle” in order to prevent tax avoidance. We describe and use elaborate examples to explain how US companies exploit flexibility in the tax code to employ transfer pricing and related tax reduction and avoidance methods. We discuss recent responses by regulatory bodies.
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Vlasova, O. "TRANSFER PRICES: PREREQUISITES FOR USE IN MANAGEMENT ACCOUNTING AND TAX ADMINISTRATION." Series: Economic science 2, no. 162 (March 26, 2021): 71–77. http://dx.doi.org/10.33042/2522-1809-2021-2-162-71-77.
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Today, the issues of transfer pricing come to the fore in the ranking of current problems of tax administration not only in Ukraine but also in the world as a whole. This is due to the need for tax control to ensure price equality between related and independent entities in international business as a measure to combat the erosion of the tax base and the withdrawal of profits from taxation. The article presents a structured analysis of research by foreign and domestic scientists on transfer pricing in the field of management accounting or tax control. In particular, the grouping of views of scientists and practitioners on the nature and role in the accounting and analytical system of transfer pricing from the point of view of management accounting and tax administration. Study of the impact on the practice of transfer pricing methods of the picture of economic reality distorted by the negative impact of the COVID-19 pandemic. The need to use the transfer pricing mechanism in management accounting is due to the current trend of decentralization of management, and a prerequisite - the desire of top management to accelerate the production process, accelerate the turnover of equity and maximize profits. The advantages of using transfer pricing in management accounting to accelerate the production process and maximize profits, which led to the creation of corporations with the final technological cycle. It is also established that when deciding on the use of such a tool of internal pricing, one should keep in mind the cautions analyzed in the article. The preconditions for the introduction of tax control over transfer pricing in international business, as well as the basic laws and regulations in force in the global and Ukrainian economic space. The necessity and validity of the application of the OECD International Guidelines on Transfer Pricing, despite the provisions of Art. 39 of the Tax Code of Ukraine The ways of further development of tax control over transfer pricing within the framework of the BEPS Action Plan in Ukraine are considered. The need for further research on solving the problems of transfer pricing in the field of management accounting and taxation was identified, especially on the preparation of an information basis to justify the compliance of transfer prices with «Arm’s length principle».
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Anggani, Maharamya Karuna, and Trisni Suryarini. "Determinant of Transfer Pricing Decision in Infrastructure, Utility, and Transportation Companies." Jurnal Akuntansi Indonesia 9, no. 2 (October 11, 2020): 150. http://dx.doi.org/10.30659/jai.9.2.150-167.
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ABSTRAKPenelitian ini bertujuan untuk menganalisis dan mengetahui besarnya pengaruh tax planning, thin capitalization, dan intangible assets terhadap keputusan perusahaan dalam melakukan transfer pricing. Penelitian ini menggunakan 78 perusahaan manufaktur yang terdaftar di Bursa Efek Indonesia (BEI) tahun 2014 hingga 2018 sebagai populasi penelitian. Pemilihan sampel penelitian ini menggunakan metode purposive sampling, dan diperoleh hanya 65 data yang dapat digunakan untuk data analisis. Metode analisis data yang digunakan dalam penelitian ini adalah analisis statistik deskriptif dan analisis statistik inferensial dengan menggunakan uji linear berganda untuk model regresi. Hasil penelitian menunjukkan bahwa thin capitalization dan intangible assets tidak berpengaruh secara signifikan terhadap keputusan perusahaan dalam melakukan transfer pricing. Sedangkan, tax planning berpengaruh secara signifikan terhadap keputusan perusahaan dalam melakukan transfer pricing. Kata kunci: Transfer Pricing; Tax Planning; Thin Capitalization; Intangible Assets ABSTRACTThis study aims to analyze and determine the affect of tax planning, thin capitalization, and intangible assets on company decisions in transfer pricing. This study uses 78 manufacturing companies listed on the Indonesia Stock Exchange (IDX) from 2014 to 2018 as the study population. The sample selection of this study used a purposive sampling method, and the final sample was obtained by 65 data which is can use for data of analysis. Data analysis methods used in this study are descriptive statistical analysis and inferential statistical analysis using multiple linear tests for regression models. The results showed that thin capitalization and intangible assets did not significantly influence the company's decision to transfer pricing. At the same time, tax planning significantly influenced the company's decision to transfer pricing.Keywords: Transfer Pricing; Tax Planning; Thin Capitalization; Intangible Assets
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Turwanto, Turwanto, Kingkin Primasari, and Amrie Firmansyah. "Penghindaran Pajak Melalui Transfer Pricing Pada Perusahaan Di Indonesia: Analisis Isi Atas Risalah Putusan Pengadilan Pajak." Educoretax 2, no. 1 (March 17, 2022): 75–90. http://dx.doi.org/10.54957/educoretax.v2i1.158.
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This study aims to review the transfer pricing practices carried out by companies in Indonesia. The method used in this research is qualitative with a content analysis approach. The data used comes from the tax court minutes for conditions where the company has evaded tax—data obtained from http://www.setpp.kemenkeu.go.id. The aspects used in this research include special relationships, transfer pricing schemes and types, and the methods used in determining fair prices. The results showed that the three companies in this study had special relationships with companies abroad. The three companies are subsidiaries, either directly or indirectly, with overseas parent companies. The transfer pricing scheme consists of selling goods at unreasonable prices to affiliated companies and paying management fees that are not based on a clear underlying transaction. The methods used by the Directorate General of Taxes in determining the equivalence and fairness of transfer prices include the transactional net margin method and the cost-plus method. Tujuan penelitian ini adalah untuk mengulas praktik transfer pricing yang dilakukan oleh perusahaan di Indonesia. Metode yang digunakan dalam penelitian ini adalah kualitatif dengan pendekatan analisis isi. Data yang digunakan berasal dari risalah pengadilan pajak untuk kondisi di mana perusahaan terbukti melakukan penghindaran pajak. Data diperoleh dari http://www.setpp.kemenkeu.go.id. Adapun aspek yang digunakan dalam penelitian ini meliputi hubungan istimewa, skema dan jenis transfer pricing, dan metode yang digunakan dalam menentukan harga wajar. Hasil penelitian menunjukkan ketiga perusahaan dalam penelitian ini memiliki hubungan istimewa dengan perusahaan di luar negeri. Ketiga perusahaan tersebut merupakan anak usaha baik secara langsung maupun tidak langsung dengan perusahaan induk di luar negeri. Skema transfer pricing yang digunakan terdiri dari penjualan barang dengan harga tidak wajar kepada perusahaan afiliasi dan pembayaran jasa management fee yang tidak berdasar underlying transaction yang jelas. Metode yang digunakan Direktorat Jenderal Pajak dalam menentukan kesebandingan dan kewajaran harga transfer meliputi metode transactional net margin method dan metode cost plus.
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Rifqiyati, Rifqiyati, Masripah Masripah, and Munasiron Miftah. "Pengaruh Pajak, Multinasionalitas, dan Tunneling Incentive terhadap Keputusan Transfer Pricing." Jurnal Akuntansi, Keuangan, dan Manajemen 2, no. 3 (June 25, 2021): 167–78. http://dx.doi.org/10.35912/jakman.v2i3.214.
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Purpose: This research aimed to determine the effect of taxes, multinationality, and tunneling incentive on the decision on transfer pricing in non-financial sector companies. Research methodology: This research uses quantitative research methods. Testing the hypothesis used multiple linear regression analysis with panel data on Stata 16.0. The population is non-financial sector companies listed on the IDX in 2017-2019. This research has a sample of 53 companies. Results: Based on the results of data analysis, it can be concluded that (1) taxes has a positive and significant effect on the decision on transfer pricing, (2) multinationality has a positive and significant effect on the decision on transfer pricing, (3) tunneling incentive has no effect on the decision on transfer pricing. Limitations: This limitation of research is the number of samples used in this research due to many companies that do not meet the established criteria. Contribution: This study's results can be used as a reference for further researchers and take into consideration for company management, investors and creditors in making decisions.
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Valente, Piergiorgio. "Transfer Pricing Audits: Position of the Italian Courts." Intertax 41, Issue 1 (January 1, 2013): 42–48. http://dx.doi.org/10.54648/taxi2013004.
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The Italian Tax Authorities encounter difficulties in supporting their own transfer pricing audits in an unassailable manner, which is by no means a lesser difficulty than the one the taxpayer has to face when having to structure its own transfer pricing policy, especially if its intention is to adopt traditional methods. With reference to the application of the cost-plus mark-up method, the Italian Courts rejected the Tax Authorities' assessments on the basis that comparability was not absolute. Even when the Tax Authorities - with regard to differences of functions and risks - extensively debated on their irrelevance for the purpose of determining the price, the Judges ultimately ascertained an inadequate motivation for such position.
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Visconti, Roberto Moro. "Exclusive Patents and Trademarks and Subsequent Uneasy Transaction Comparability: Some Transfer Pricing Implications." Intertax 40, Issue 3 (March 1, 2012): 212–19. http://dx.doi.org/10.54648/taxi2012024.
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Intangible assets are intrinsically difficult to evaluate and compare; due to their immaterial nature, they are frequently negotiated within multinational groups and thus become sensitive to transfer pricing issues. OECD guidelines address the complex problem of trying to adapt standard transfer pricing methods to specific circumstances. Arm's length comparisons are particularly problematic for exclusive and specific patents and trademarks and also as a consequence of the intrinsic confidentiality that concerns their transactions.
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Kuzheliev, M. O., and I. M. Syvolap. "The Main Stages of Normative Regulation of Financial Control Over Transfer Pricing in Ukraine." Business Inform 4, no. 519 (2021): 196–204. http://dx.doi.org/10.32983/2222-4459-2021-4-196-204.
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Any activity is carried out in accordance with what laws and regulations are interpreted at the national level, and often with the direct consent o n the part of the State authorities. In Ukraine, the process of forming the normative regulation for control over transfer pricing is still underway, but conceptually it is already possible to define four main stages. Stage 1 (zero stage): 2010–2013 – in the national legislation were no definitions of controlled operations and transfer pricing, but the concept of ordinary price was widely used, and the tax legislation began to distinguish the methods for its determination and the procedure for application). Stage 2 (baseline stage): 2013–2014 – a significant transformation of tax legislation took place – transfer pricing was introduced in Ukraine. Stage 3 (crucial stage): 2015–2019 – the «arm’s length principle» was introduced, which was wider than the concept of «ordinary price», and relations between business entities were now evaluated not only at the price of transactions performed, but under the conditions of such operations. Stage 4 (renewal stage): 2020–2021 – transfer pricing rules were updated: new concepts were introduced into the national legislation – international group of companies, the group’s parent company, authorized participant; a three-level transfer pricing reporting model was implemented. Thus, Ukraine undergoes a constant change of national legislation, in particular in the normative regulation of financial control over transfer pricing, which for 10 years has been transformed from control over ordinary prices in the country to control over transactions of international groups of companies whose participants are residents of Ukraine.
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Fernandes, Rui, Carlos Pinho, and Borges Gouveia. "Supply chain networks design and transfer-pricing." International Journal of Logistics Management 26, no. 1 (May 11, 2015): 128–46. http://dx.doi.org/10.1108/ijlm-04-2013-0042.
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Purpose – The purpose of this paper is to provide a new modelling framework for distribution network strategy and to study how various transfer-pricing schemes cope with stochastic demand under different countries tax policies. Design/methodology/approach – Use is made of real options to quantify the available options for supply chain network design. The application of real options approach relies on three main conditions, such as the existence of uncertainty (market), flexibility (different network design) and irreversibility (investments) in the decision process. Findings – Evaluation of the potential impact of changes in local tax policies on long-run plant and distribution centers location decisions. A more intensive tax regime tends to promote changes in the distribution network that support multinational companies. In high uncertain markets, the options to change the network are more attractive – uncertainty is linked with an increase in flexibility. Practical implications – The present study provides decision makers with a useful tool for supporting the design of global logistics networks, considering different scenarios and therefore determines a more after-taxes profitable logistics network configuration. Originality/value – Integrate financial issues while studying different scenarios for supply chain network designs. It presents a model that focus on distribution network design considering transfer-pricing methods as decision variables and aiming after-taxes bottom-line results maximization. There are relatively few “reported” implementations of global profit maximization models for large-scale networks. Thus, we believe that the implementation of global profit maximization models represents a potentially significant unrealized opportunity worthy of serious consideration by many firms.
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Smith, Michael. "Tax and Incentive Trade-Offs in Multinational Transfer Pricing." Journal of Accounting, Auditing & Finance 17, no. 3 (July 2002): 209–36. http://dx.doi.org/10.1177/0148558x0201700302.
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Multinationals use transfer prices both for tax minimization and for managerial incentives. This paper analyzes two methods of disentangling the tax and incentive roles: setting multiple prices and using performance measures independent of transfer prices. Even with imperfect enforcement of transfer-pricing rules, regulator scrutiny limits the firm's flexibility. Transfer prices affect after-tax income both by influencing the manager's production decisions ex ante and by allocating income ex post across tax jurisdictions. If the ex ante incentive role dominates the ex post tax role, the firm increases the transfer price received by the subsidiary even if the subsidiary tax rate increases.
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Sari, Nuraini, and Ririn Susanti Hunar. "Analysis Method of Transfer Pricing Used by Multinational Companies Related to Tax Avoidance and its Consistencies to the Arm's Length Principle." Binus Business Review 6, no. 3 (December 1, 2015): 341. http://dx.doi.org/10.21512/bbr.v6i3.944.
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The purpose of this study is to evaluate about how Starbucks Corporation uses transfer pricing to minimize the tax bill. In addition, the study also will evaluate how Indonesia’s domestic rules can overcome the case if Starbucks UK case happens in Indonesia. There are three steps conducted in this study. First, using information provided by UK Her Majesty's Revenue and Customs (HMRC) and other related articles, find methods used by Starbucks UK to minimize the tax bill. Second, find Organisation for Economic Co-Operation and Development (OECD) viewpoint regarding Starbucks Corporation cases. Third, analyze how Indonesia’s transfer pricing rules will work if Starbucks UK’s cases happened in Indonesia. The results showed that there were three inter-company transactions that helped Starbucks UK to minimize the tax bill, such as coffee costs, royalty on intangible property, and interest on inter-company loans. Through a study of OECD’s BEPS action plans, it is recommended to improve the OECD Model Tax Convention including Indonesia’s domestic tax rules in order to produce a fair and transparent judgment on transfer pricing. This study concluded that by using current tax rules, although UK HMRC has been disadvantaged because transfer pricing practices done by most of multinational companies, UK HMRC still cannot prove the transfer pricing practices are not consistent with arm’s length principle. Therefore, current international tax rules need to be improved.
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Depari, Anggun Budi Utami S., Reza Ramadhan, and Amrie Firmansyah. "TRANSFER PRICING DECISIONS AT MULTINATIONAL COMPANIES IN INDONESIA: TAX EXPENSES, FOREIGN OWNERSHIP, INTANGIBLE ASSETS." JURNAL TERAPAN MANAJEMEN DAN BISNIS 6, no. 2 (September 30, 2020): 46. http://dx.doi.org/10.26737/jtmb.v6i2.2282.
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<p>This study aims to examine the effect of tax expenses, foreign ownership on transfer pricing decisions. This study employs quantitative methods. This study's data type is secondary data from the financial statements of manufacturing companies listed on the Indonesia Stock Exchange (IDX) from 2017 to 2019. Data were obtained from the Indonesia Stock Exchange's official website at http: //www.idx.co.id. Sampling was conducted by purposive sampling technique with a final sample of 30 observations. Hypothesis testing is done by multiple regression analysis with panel data. This study concludes that tax expenses and intangible assets are positively associated with transfer pricing decisions, while foreign ownership is not associated with transfer pricing decisions. This study indicates that Indonesia's Tax Authority needs to exercise tighter supervision on MNCs with intangible assets.</p>
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Rahmiati, Alfa, and Resti Sandi. "Exploring The Arm's Length Transfer Pricing Strategy for Taxation Purpose: An Ethnographic Study in a Manufacturing Enterprise." Asian Journal of Accounting Research 1, no. 1 (February 29, 2016): 8–15. http://dx.doi.org/10.1108/ajar-2016-01-01-b002.
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Practices of transfer pricing in among companies having “special relationship” (hubungan istimewa in Bahasa Indonesia, this study uses a term of ‘related party’) to others are very common nowadays. However, the complexity of transfer pricing strategy and practices in many companies made the use of individual level data become insufficient, therefore we conduct an ethnographic study to explore how taxpayer determines the reasonable transfer pricing based on five methods (i.e. Comparable uncontrolled Price/CUP, Resale Price/RPM, Cost Plus, Transactional Net Margin Method/TNMM and Profit Split Method/PSM).This research aims to execute a tax strategy based on those methods, which finally derive the amount of product price according to arm.s length transfer pricing rule. We collected the data through interviews, observation and literatures. They are based on several months of personal experience of field research in and around the manufacturing enterprise. The results showed that the tax expense could be reduced by using Cost Plus Method, but practically, the application of this method requires more in-depth analysis and a very reliable & comparative data so the company must spend a lot of cost and time to process it. The Transactional Net Profit Method is proved to be the best application for the enterprise to optimize tax expenses because the data used for the analysis were more accessible which saved time and costs.
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Sitanggang, Raymondo, and Amrie Firmansyah. "TRANSAKSI DENGAN PIHAK BERELASI DAN PRAKTIK TRANSFER PRICING DI INDONESIA." Jurnal Pajak dan Keuangan Negara (PKN) 2, no. 2 (March 31, 2021): 34–52. http://dx.doi.org/10.31092/jpkn.v2i2.1180.
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This study aims to review transactions conducted by multinational companies operating in Indonesia related to transfer pricing activities. This study uses qualitative methods using two approaches, content analysis, and interviews. The content analysis aims to obtain related party disclosure information in the financial statements as stipulated in PSAK No. 7 (2015). The data used in the financial statements of manufacturing companies in the consumer goods industry sector are included in multinational companies and listed on the Indonesia Stock Exchange from 2014-2017. Meanwhile, interviews were conducted to confirm the data obtained through content analysis. The informant in the interview is one of the Polytechnic of State Finance STAN lecturer, who has academic expertise in international tax accounting and transfer pricing. This study concludes that, in general, multinational companies operating in Indonesia have disclosed related party information in their financial statements. Furthermore, the assessment of the fairness of transactions with related parties related to transfer pricing is based on the arm's length principle. The results of this study indicate the need for broader disclosure of financial accounting standards in Indonesia and the harmonization of taxation regulations in Indonesia with tax regulations in other countries related to transfer pricing practices. Penelitian ini bertujuan untuk untuk mengulas transaksi-transaksi yang dilakukan oleh perusahaan multinasional yang beroperasi di Indonesia terkait dengan aktivitas transfer pricing. Penelitian ini menggunakan metode kualitatif dengan menggunakan dua pendekatan, yaitu content analysis dan wawancara. Content analysis bertujuan untuk mendapatkan informasi pengungkapan pihak-pihak yang berelasi dalam laporan keuangan sebagaimana diatur dalam PSAK No. 7 (2015). Data yang digunakan adalah laporan keuangan perusahaan manufaktur sektor industri barang konsumsi yang termasuk dalam kategori perusahaan multinasional dan terdaftar di Bursa Efek Indonesia dari tahun 2014-2017. Sementara itu, wawancara dilakukan dengan tujuan untuk mengkonfirmasi data-data yang diperoleh melalui content analysis. Informan dalam wawancara adalah salah satu dosen Politeknik Keuangan Negara STAN yang memiliki keahlian akademis dalam akuntansi perpajakan internasional dan transfer pricing. Penelitian ini menyimpulkan bahwa secara umum perusahaan multinasional yang beroperasi di Indonesia telah mengungkapkan informasi pihak-pihak berelasi dalam laporan keuangannya. Selanjutnya, penilaian kewajaran transaksi dengan pihak berelasi terkait dengan transfer pricing berdasarkan arm’s length principle. Hasil penelitian ini mengindikasikan perlunya pengungkapan yang lebih luas dalam standar akuntansi keuangan di Indonesia dan harmonisasi peraturan perpajakan di Indonesia dengan peraturan perpajakan di negara lain-lain terkait dengan praktek transfer pricing.
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Park, Min. "U.S. Advance Pricing Agreement: An Option to Resolve International Tax Dispute in Transfer Pricing Cases." International Area Review 1, no. 1 (December 1997): 115–33. http://dx.doi.org/10.1177/223386599700100108.
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Obtaining a preliminary approval from its tax authority as to its mehodologies of transfer pricing would provide taxpayers with a safe harbor. This preliminary measure provides positive assurance against unexpected income allocation adjustments made by the tax authority. Such a procedure is commonly referred to as an “Advance Pricing Agreement(APA).” In order to be an effective income allocation method, an APA must be an either binational or multinational. Only binational or multinational APA could supplement the judicial, administrative, and treaty mechanisms for resolving transfer pricing issues related to income allocation when the traditional methods fails or are difficult to apply. The binational APA negates the need to obtain APAs from two tax authorities and reduces the possibility of lengthy competent authority audits and negotiation. Thus, the binational APA can decreases burdens on both the taxpayers and tax authorities, and also helps avoid the risk of double taxation.