Transfer Pricing

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Do you comply with the Ukrainian statutory regulations?

Transfer pricing (TP) continues to be a burning issue on multiple, converging fronts. Starting from 2013 the Ukrainian tax authorities have substantially increased their attention to cross-border transactions with related parties and have already started TP audits. Compliance with the TP rules imposes significant administrative burden on taxpayers. Our TP team is ready to help you manage your TP risks and find opportunities for sustainable improvement of the tax efficiency of your business.

In order to comply with the Law, taxpayers will have to develop procedures for collecting and processing information on prices, checking if prices of controlled transactions are at arm’s length, and preparing and submitting all necessary documents to the tax authorities by the set deadlines.

The best way to tackle these issues is to come up with a robust transfer pricing methodology, create efficient business processes and organisational structure in order to comply with the transfer pricing legislation.

How we can help

1. Compliance

  • running a diagnostic on the Group’s existing controlled transactions from the perspective of the TP legislation;
  • assisting in preparation of the TP documentation to substantiate the arm’s length level of prices applied;
  • performing benchmarking studies to determine the arm’s length profitability;
  • assisting in preparation of the report on controlled transactions.

2. Planning and TP policy development

  • developing a unified methodology for determining prices in controlled transactions;
  • providing recommendations on improvements to pricing policies, in particular, by value chain transformation;
  • developing and assisting in the creation of trading and procurement structures;
  • assisting in structuring of year-end compensatory adjustments.

3. TP audits and dispute resolutions

  • assisting during the whole process of a tax authorities’ TP audit, including responses to the official requests, supporting in interviews, etc;
  • providing tax and legal support during the TP litigation process.

4. Advice on TP matters

  • providing advice on various TP matters.

5. Advance Pricing Agreement

  • preparing necessary documentation for entering a procedure;
  • supporting during the negotiation process, including economic analysis, responses to tax authorities’ requests, etc;
  • participating in discussions with the tax authorities (including the pre-consideration stage).

6. Development of TP business processes

  • developing business processes for setting and monitoring prices in controlled transactions;
  • developing and describing business processes and algorithms for collection, analysis and classification of the controlled transactions, for calculation of the arm’s length price, and for preparation of the reporting documentation;
  • developing and describing the functional and technical requirements, as well as the algorithm of the information system functioning, including requirements for key data sources, the reference structure, etc.

PwC specialists have experience in providing transfer pricing-related services to both Ukrainian and foreign companies. Our staff’s extensive technical and practical experience working in dedicated teams enables us to advise our clients on the most complex issues.