Commentary

B4.140 Transfer pricing—transactions and structures

Business tax
Business tax | Commentary

B4.140 Transfer pricing—transactions and structures

Business tax | Commentary

Types of transactions and arm's length pricing

B4.140 Transfer pricing—transactions and structures

Within multinational enterprises (MNE) there are many different ways of structuring their operations and transactions and in a transfer pricing review these structures and transactions would be reviewed as part of the comparability and functional analysis (see B4.131) to establish what each entity does, what risk they bear and whether a transfer pricing adjustment is required.

The various functions of an MNE could include the following:

  1.  

    •     the principal entity in the business that controls all the other functions

  2.  

    •     manufacturing and raw material sourcing

  3.  

    •     research and

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