The stakes are high
The factors driving intensified scrutiny of transfer pricing arrangements are beyond the control of most companies, but the risks to your organisation are very real. They include:
- very large local tax reassessments - with significant penalties and interest on overdue tax – and double taxation on income when relief under tax treaties is not available;
- uncertainty about your worldwide tax burden, and expensive, time-consuming conflicts with regulatory authorities;
- damage to reputation and corporate brand if seen as a bad corporate citizen.