International Taxation and Transfer Pricing

Transfer pricing refers to the pricing of goods, services, or intangible assets between related entities in different jurisdictions. The pricing must comply with the arm's length principle, ensuring that intercompany transactions are conducted at market prices.

It ensures that:

• Tax authorities in different countries tax profits correctly.
• Companies avoid penalties for non-compliance.
• The OECD guidelines are adhered to, ensuring international consistency.

UAE businesses with international operations must prepare and maintain:

• Master file: A global overview of the business, organizational structure, and financials.
• Local file: Detailed information on intercompany transactions, including prices and agreements.
• Country-by-country reporting (CbCR): For multinational groups with consolidated revenue exceeding EUR 750 million.

We assist with:

• Transfer pricing documentation preparation in line with local and international standards.
• Pricing strategies that comply with the arm's length principle.
• Conducting transfer pricing risk assessments to minimize exposure.
• Filing and submission of required documents to tax authorities.

Non-compliance can lead to:

• Penalties and fines imposed by local tax authorities.
• Double taxation on profits, as countries may adjust pricing to increase their taxable base.
• Audit risks, leading to expensive and time-consuming investigations.

Yes, we provide:

• Dispute resolution services to manage tax authority inquiries.
• Support in negotiating settlements and ensuring fair treatment.
• Representation in transfer pricing-related audits.

International tax treaties are agreements between two countries designed to avoid double taxation. They typically reduce or eliminate tax on:

• Cross-border dividends.
• Interest payments.
• Royalties and other income streams.
  These treaties may also provide for the allocation of taxing rights between countries.

Through careful planning, companies can:

• Take advantage of tax treaties and avoid double taxation.
• Structure operations efficiently to reduce overall tax burdens.
• Utilize tax credits and incentives available in different jurisdictions.

The arm's length principle states that prices for transactions between related entities should be the same as if they were dealing with independent third parties. It ensures fair pricing and prevents profit shifting between tax jurisdictions.

Yes, businesses engaged in international trade must maintain and file transfer pricing documentation in accordance with UAE regulations, ensuring transparency and compliance with global tax standards.

Our services include:

• Cross-border tax advisory and tax treaty planning.
• Preparation of transfer pricing documentation.
• Global tax compliance for multinational operations.
• Custom tax solutions for businesses with operations in multiple countries.
• Assistance with double taxation relief and withholding tax optimization.

We stay updated on the latest OECD guidelines, local country-specific requirements, and international best practices, ensuring your documentation is accurate and up-to-date.

We work proactively with you to:

• Identify and mitigate potential risks in international transactions.
• Optimize your transfer pricing strategies to align with local and international regulations.
• Establish proper documentation to defend against audits.