Transfer Pricing

Maintaining arm's length standards for your business

The recent financial crisis has led many tax authorities to implement transfer pricing regulations for protecting their tax base. The sheer value of cross border transactions provides the easiest way for tax authorities to protect their tax base while simultaneously managing the fiscal deficit resulted through financial stimulus packages and economic recovery plans. 

With the increased focus on transfer pricing, PwC Singapore’s specialised transfer pricing team is ready to manage and address your transfer pricing needs.

The PwC Singapore transfer pricing team is a dedicated team of professionals who have high quality consulting capabilities in providing practical and tailor made business solutions to your transfer pricing needs. We are a part of the new organizational model which divides the PricewaterhouseCoopers network into three major clusters led by the senior partner of the leading national firm in each cluster. The East Cluster includes China, Singapore and Hong Kong, the South East Asia Peninsula, Oceania, Australia, New Zealand, Japan, Korea, the Philippines and Taiwan. Being part of the East Cluster, will enable us to draw and leverage off the experiences of our network firms while serving clients across industries. 

As a team, we are passionate to meet and exceed our client’s expectations by delivering service of the highest standard and by adding value to our clients. In doing so, we partner with our clients to understand their organisational objectives and the industry in which they operate to provide practical solutions to their needs. Building on the knowledge of our dedicated industry specialists in areas such as Pharmaceutical and Healthcare, Oil and Gas, Financial Services, and Technology, Information, Communications and Entertainment (“TICE”) we have also provided industry specific solutions from a transfer pricing perspective to our clients.

Our Approach

We provide practical and tailor made transfer pricing solutions to your business life cycle needs within the national, regional and international space in the areas of:

Optimising your infrastructure processes and systems to deliver competitive customer service can be a major challenge—especially when so many parameters, from technology to labour mobility to legislation, are in such flux. PwC’s Value Chain Transformation™ (VCT) model has been designed to help companies transform the way they do business every step of the way, from initial strategy through final delivery—in a tax-advantaged manner.

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With more and more countries introducing formal transfer pricing documentation requirements one can expect to see a surge of transfer pricing audits resulting in tax controversies going forward. As companies increasingly focus on globalising their operations and OECD stepping up its efforts on sharing information across jurisdictions, it is imperative for them to consider transfer pricing issues carefully while structuring their business operations. With tax authorities becoming more sophisticated, audits can be thorough and enforcement actions too harsh.

Singapore tax authorities have also introduced transfer pricing consultation procedure in Singapore whereby they are trying to emphasize the importance of transfer pricing documentation in Singapore. This process is a pre-cursor to transfer pricing audits.  The tax authorities have also started transfer pricing audits and examinations for some of the taxpayers they consider to be high risk.

This new environment therefore requires multinational corporations to take proactive, coordinated steps to understand their transfer pricing arrangements and documentation requirements. Disputes and audits must be avoided, managed, and resolved. All issues must be coordinated and aligned across jurisdictions before they develop into larger business concerns.

How PwC can help

  • Tax dispute avoidance techniques - You need to know whether and where any transfer pricing audit exposure exists. We can help you implement sound policies and processes that may provide a defensible model, and help safeguard against tax audits and disputes. We can conduct reviews of your documentation and inter-company agreements, analyse and identify your opportunities to reduce tax and penalty exposure, and recommend “best practice” policies for your related-company transactions.
  • Tax audit management practices - We can recommend processes to manage your transfer pricing audits and examinations, which may reduce the risk of income adjustments and avoid escalation of more involved disputes. Our team of professionals in Singapore has assisted many taxpayers during the transfer pricing consultation stage and also during the subsequent audit stage. We can help you craft a strategic response to taxing authority requests.
  • Tax dispute resolution alternatives - We can work with you at both the global and local level to implement practices that may reduce or eliminate the likelihood of prolonged disputes or litigation. Many of our professionals come to us from prominent positions in academia, industry and government. This highly strategic experience places PwC in a strong position to help you identify technical issues, analyse findings, prepare presentations, and assist in the resolution of any disputes. Our team of professionals in Singapore has been involved in significant number of advance pricing agreements (APAs) and Competent Authority (CA) negotiations, specifically at bilateral levels. Our team is also currently involved in assisting taxpayers with their bilateral APAs and CA negotiations with countries like Japan, China, Taiwan and Australia. As of last year, our team was involved in almost half the bilateral APAs and CA negotiations which Singapore was undertaking with overseas CAs. Our team also has significant experience with unilateral APAs in Singapore. We can assist with all aspects of your advance pricing agreements (APAs) and Competent Authority negotiations.
  • Global strategic planning of tax audit and disputes - We are well positioned across our member firms to help you develop a global strategy for avoiding or managing any future transfer pricing disputes or examinations. In addition to advising on the proactive use of APAs, we can recommend strategies consistent with your goals that utilise foreign tax credits, separate country net operating losses, foreign currency positions, tax holidays, and other tax attributes.

Under constant pressure to drive up the bottom-line, companies are restructuring their operating structures and supply chains as they move operations globally. PricewaterhouseCoopers Singapore’s transfer pricing team can assist you in adequately planning and structuring the new tax and legal structures to reflect your new operations. We do this by:

  • realigning structures in a manner which are tax-advantageous;
  • conducting periodic reviews of possible transfer pricing risks and advising on ways and means to manage it;
  • assistance in establishing a written transfer pricing policy;
  • review inter-company policy on intangible assets;
  • advice on allocation of head office expenses and other inter-company charges.

Are your transfer pricing policies properly documented? This is the key to any defence strategy. Undocumented policies make you legally exposed to audit adjustments. Now, with more than 60 countries having introduced formal transfer pricing documentation requirements and the number still growing, it is imperative for companies to have transfer pricing documentation in place to defend their transfer prices. To help companies with a diverse spectrum of needs, PricewaterhouseCoopers adopts customised approaches through the following options to develop the necessary documentation which suits your business needs.

Contact us

Andrew Fairfoull

Partner, Tax

Tel: +65 9620 7417

Falgun Thakkar

Partner, Transfer Pricing

Tel: +65 9634 7984

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