We provide comprehensive transfer pricing (TP) solutions suited to the needs of the client.

Transfer Pricing Planning and Risk Assessment, and Policy Making

Prior to commencing any domestic or international transaction with an associated enterprise, it is essential that such transaction is evaluated, structured, and planned to ensure that TP implications are addressed. Planning, risk assessment, and setting the TP Policy bring certainty to related-party transactions and mitigate the company’s tax exposure in advance.

Our services include:

  1. Drafting of the company’s TP policy in accordance with rules and regulations of tax authorities
  2. Identification of the company’s TP transactions with related parties and assessment of the level of risk involved
  3. Review of related-party or inter-company agreements
  4. Business restructuring of cross-border related-party transactions
Transfer Pricing Documentation (TPD), Review and Benchmarking Study

To adhere to TP rules, transactions with related parties must be conducted on an arm’s length basis. The burden of demonstrating the arm’s length nature is on the taxpayer. It is done by maintaining sufficient documentation showing that transactions are made under comparable terms and conditions with independent parties.

Our services include:

  1. Documentation

We assist in the company's documentation of transfer pricing components such as organizational structure, comparability, functional and risk analysis, nature of the business/industry and market conditions, selection of the transfer pricing method, description of controlled transactions, application of the transfer pricing method and localization of global TPD to comply with Philippine tax requirements.

  1. Transfer Pricing Review

We assess companies’ adherence to TP regulation and evaluate their overall level of compliance. We also review global TP policies for compliance with Philippine requirements; identify transactions that expose the company to potential tax liabilities, including assessment of risk and estimation of tax exposures and penalties; and advise the company on proper courses of action, and alternative tax-efficient TP policies and procedures.

  1. Benchmarking Study

We perform benchmarking analysis using the BIR's acceptable database. The analysis includes the search for comparable companies, computation of the acceptable profitability level, and providing meaningful conclusions.

Transfer Pricing Audit Defense

The existence of a TPD demonstrates that reasonable efforts had been exerted to ensure that a TP policy is in place and that transactions are conducted at arm’s length. However, this will not preclude tax authorities from conducting TP audit and challenge a company’s documentation.

Our services include:

  1. Meeting with tax authorities on behalf of the company to discuss pertinent details of the TPD; and
  2. Providing support at all levels during the tax authorities’ tax audit or investigation, including responding to corresponding queries related to the company’s TPD.
Transfer Pricing Training and Consultation

We offer seminars and training on TP-related developments, including latest pronouncements from tax authorities. Upon request, we provide customized in-house TP training designed jointly by P&A Grant Thornton and the company to directly address specific issues of the client’s industry and the training needs of its personnel.