Transfer Pricing Documentation
“Post BEPS”, multinational enterprises are required to provide Tax Authorities with vast amounts of documentation, in the form of Master Files, Local Files and Country-by-Country Reports (if applicable). The drafting of transfer pricing documentation is an extensive project that requires considerable effort in terms of sourcing the information required. It can be quite a daunting task for companies.
Eurofiscus is able to alleviate the majority of this burden by implementing its state-of-the-art drafting tool. Via a top-down method we are able to produce OECD compliant transfer pricing documentation that is 100% consistent with transfer pricing documentation from all other legal entities, all in a highly (cost-)efficient manner.
Our transfer pricing documentation has been tested by tax inspectors, tax advisors, auditors and tax departments of some of the largest multinationals in the world and they were all surprised by the precision, consistency and completeness. Our transfer pricing documentation is a complete package of all transfer pricing related documents of that year, which makes it very useful for legacy purposes as well.
Eurofiscus drafts its documents through an automated tool, which promotes standardisation of the information provided through an “enter data only once” principle. After our introductory presentation of the platform and our workflow, we will start our sourcing exercise by sending the client a series of questionnaires, which will give us a quick inventory of the legal entities within the Group, the functional profiles they have, as well as more general information on the Group. Examples of the latter are the Group’s business- and governance models. The OECD Guidelines give a clear overview on what the Tax Authorities expect to see in transfer pricing documentation. The results of our sourcing will be presented in the form of a master file that goes above and beyond those expectations.
Once a master file has been drafted, we can start populating the tool with entity-specific information such as functional profiles and intercompany transactions that have occurred. After all the required data has been provided, Eurofiscus will start analysing this data by calculating the profit percentages generated by the individual legal entities, and offsetting this with benchmark studies or other reference data, based on its current functional profiling. It is in this phase that we will present to the client which legal entities are "within the range". Outliers will be pointed out and a course of action will be discussed with the client.
All the processed data will result in a magnitude of 100% consistent sets of transfer pricing documentation that comply with all the requirements the OECD has set for the master file and local files.