The finalization of the OECD BEPS guidance in relation to transfer pricing documentation and Country by Country Reporting (“CbCR”) has a profound impact to your approach to supporting your intercompany transactions around the world.
At the same time, on going discussions are getting more intense around new rules on where tax should be paid ("nexus" rules) and on what portion of profits should multinationals be taxed ("profit allocation" rules), on the basis of a "Unified Approach" on the so called Pillar One of the Inclusive Framework of the OECD. This will make it a priority for multinationals to evidence the conduct of a sustained and significant business in places where they operate but most importantly where they may not have a physical presence since they can still be taxed in such jurisdictions.
Progress is also made on the so called Pillar Two, which aims to address remaining BEPS issues, the tax challenges arising from digitalization of the economy and to ensure that international businesses pay a minimum level of tax.
In this context, you will need a flexible approach to your transfer pricing policy and documentation to meet the ever increasing requirements.
Why is Transfer Pricing important?
Our team will work with you to ensure that your international financial position is effectively managed and your fiscal risk covered. Together, we can put your organization in the best possible position to take advantage of the benefits of globalization and international structuring by
improving your operational and financial performance based on a long-term view of sustainable growth
providing advice and assistance in preparing transfer pricing documentation in accordance to Greek or foreign legislation to protect your organization from high re-assessments and administrative penalties
supporting you in resolving disputes with the tax authorities and in concluding advance pricing arrangements in jurisdictions providing for such framework
"With over 3,100 transfer pricing professionals deployed in more than 90 countries, we’re well positioned to advise you on developing compliant, tax-efficient structures that help advance your business goals."
As tax authorities determine how and when they will implement the OECD transfer pricing documentation guidance, we build together or update your approach to addressing new requirements in the countries in which you operate.
Our team and flexible approach will help you meet your documentation compliance obligations in Greece or abroad, reduce risk and cost, and take advantage of new opportunities in light of each of the following new requirements:
Heightened transparency on existing and new matters
Increased pressure and scrutiny on commercially-sensitive information
Increased need for coordinated and consistent documentation
PwC’s Global Coordinated Documentation™ (GCD) allows your organization to prepare its Group Master File and Local Files by utilizing the GCD main concept that creates a ‘core’ document to then be used by each country where you do business and achieve efficiency in preparation and consistency in the presentation of your transfer pricing policy.
We believe that the knowledge and insight gained from preparing the documentation can provide sufficiently greater forward looking value for you.
By working with us we will identify opportunities to leverage our experience and understanding of your business to bring ideas that span the range of intercompany transactions from tangible goods transactions to intercompany financing through the development and licensing of intangible property and allow you to design, re-design and implement a consistent transfer pricing policy in alignment with the OECD guidance and the local transfer pricing rules achieving the best possible tax outcome and reducing risks of re-assessment and high penalties.
As a result of global economic pressures, combined with the impact of the OECD’s BEPS Action Plan and the discussion around Pillar I and Pillar II, we are seeing a rapid change with respect to tax audits and controversies worldwide.
By providing insights into your transfer pricing risks and exposures worldwide, we can be the effective option to assist in your efforts to proactively prevent, efficiently manage, and satisfactorily resolve tax audits and disputes.
We can also support you with an advance pricing agreement (“APA”) that is a proactive approach to managing global transfer pricing disputes and it can enhance efficiency and effectiveness, provide certainty of tax treatment on transfer pricing matters and reduces risk of double taxation when bilateral or multilateral.
A well-balanced and properly timed diagnostic process allows you to identify gaps in your group’s transfer pricing documentation relative to the OECD’s and latest local requirements and to develop an action plan to address particularly sensitive discrepancies.
This process will enable you to assess today your strengths and weaknesses vis-à-vis global and local transfer pricing requirements to be ready for tomorrow.
One of the last missing pieces of the OECD BEPS project is the recently issued guidance on financial transactions (“the OECD FT paper”).
The OECD FT Paper states that the process of “accurate delineation” begins with an informed view of a multinational enterprise’s policies and strategies towards financial transactions and also acknowledges that the suggested economic principles do not preclude countries to also apply domestic approaches to address capital structure and interest limitations. At the same time it underscores that - besides interest rates - all terms and conditions of the financing transactions, including the volume of debt, should be tested against the arm’s length principle.
Our experts in the field can help you identify how your current group financing structures ranging from plain loans and guarantees to cash pooling and hedging can be aligned with the OECD FT paper and how you can accommodate any necessary changes to achieve such alignment or set forward a new policy regarding your financial transactions.
Don't miss our recently launched
Transfer Pricing Insights -
a series of videos where our specialists
discuss the latest TP developments.
OECD issues final paper
on the transfer pricing aspects
of financial transactions
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