Transfer Pricing in ChinaBy Steven Carey, Transfer Pricing Associates

Download

Transfer pricing is a reality for any multinational company. Tax authorities need to protect their revenue base and are actively enforcing the arm's length principle for pricing of intra-group transactions. This means that detailed transfer pricing documentation is required and that companies need to disclose related party information on tax returns, as well as prepare themselves for possible audits.

If designed and implemented early in a business life, a transfer pricing system can complement and support an MNC's business model and commercial objectives, as well as optimizing its global effective tax rate.

Recent developments in China, including the release of comprehensive transfer pricing regulations in early 2009, have sent a very clear signal that the mainland is no exception to this rule.

To read the full version of this article, please purchase the May 2009 issue of China Briefing, which can be found in the Asia Briefing Bookstore. Companies requiring assistance may contact any Dezan Shira & Associates' nine national offices at china@dezshira.com for advice or visit www.dezshira.com.

Download