As businesses expand globally, governments and tax authorities are intensifying their focus on transfer pricing, responding to the growing complexity of international operations. To address this, many countries have strengthened legislation, requiring more detailed documentation of transfer pricing practices and imposing higher penalties for non-compliance.
As a result, transfer pricing has become a crucial component of tax planning for multinational organizations. Ensuring compliance with local and international regulations while optimizing pricing strategies across jurisdictions is vital for mitigating risks and maintaining value in an increasingly complex tax environment.
Moreover, OECD’s BEPS 2.0 aims to tackle tax avoidance by ensuring taxes are paid where profits are generated. Pillar 1 gives countries with large consumer markets the right to tax multinational profits, even if the company isn’t physically present. Pillar 2 sets a global minimum tax rate of 15% to prevent profit shifting to low-tax jurisdictions, affecting groups with revenues over EUR 750 million. Smaller companies should also review their structures, as these changes will impact global tax strategies.
We at KPMG help businesses navigate the complexities of BEPS 2.0 and transfer pricing by ensuring compliance with new global tax rules. We assist in optimizing tax strategies and to avoid. We also offer expert guidance on transfer pricing documentation and strategy, helping businesses remain compliant with changing regulations and preserve value in an increasingly complex tax landscape.
We can support you with
Preparation of Transfer Pricing Documentation
▾We assist our client in preparing transfer pricing documentation including Master File and Local file that meets local and international regulatory requirements. We ensure that intercompany transactions are well-documented, minimizing the risk of audits and penalties.
Advising on Policies to Ensure Compliance with OECD Guidelines
▾We provide expert advice on developing and implementing transfer pricing policies that align with OECD guidelines. Our team helps businesses structure their intercompany pricing to ensure compliance with global standards and minimize tax risks.
Impact Assessment of BEPS 2.0 on Business Operations
▾We can help our clients assess the impact of BEPS 2.0 on their global tax structures. We analyze how the global minimum tax and redistribution of taxing rights (Pillar 1 and Pillar 2) affect operations, ensuring compliance and strategic alignment.
Benchmarking and Financial Analysis
▾We conduct benchmarking studies to determine arm's-length prices for intercompany transactions, using market data and financial analysis to justify pricing decisions. Our financial models help businesses support their transfer pricing policies and mitigate compliance risks.
Dispute Resolution
▾We provide support in managing transfer pricing disputes with tax authorities. Our team assists in resolving issues through audits and appeals , ensuring that businesses can minimize disputes and achieve favorable outcomes.
