BDO is an international network of public accounting, tax and advisory firms which perform professional services under the name of BDO. We have representation in 157 territories, with 64.300 people working out of over 1.400 offices worldwide.
Our distinctive reputation for maintaining close relationships with our clients is built upon our commitment to all our stakeholders that what matters to them also matters to us. We work with our clients to define what exceptional client service means to them and we always aim to bring insight and up-todate thinking so that they can meet their objectives.
As an international accounting, tax and advisory firm, we provide all relevant services to businesses worldwide. We therefore can provide our client with tailor made services in a wide range of industries.
With respect to transfer pricing, we assist our clients in all aspects. This includes value chain tax structuring, preparation of transfer pricing documentation, provision of benchmark studies, dispute resolution and advance pricing agreements with the tax authorities.
Through our international network we are able to assist clients on a global scale, with the personal and pragmatic BDO approach our clients expect from us. This means that we maintain a close relationship and take the aspects that are most relevant for our clients as a starting point.
The Transfer Pricing Market
Transfer pricing is becoming increasingly important every day. Following the Base Erosion and Profit shifting (BEPS) project of the OECD and G20, businesses worldwide are facing new, more stringent approaches towards transfer pricing. Although at first this can be perceived as an additional burden and compliance costs, we believe these developments present opportunities for our clients both from a tax control as well as from a transparency perspective towards the stakeholders.
The BEPS project resulted in various recommendations towards the OECD member states, specifically towards how documentation should be prepared. These recommendations are also followed by various non-OECD countries. For companies, a global implementation of these recommendations results in a more uniform approach towards transfer pricing. This should significantly lower the burden and tax uncertainty in this respect.
The public domain has become critical towards companies with specific setups and relative tax burdens. A solid transfer pricing model can help prevent negative views on the company’s situation in this respect. Companies that have a transfer pricing model that is aligned with the business model remain in control, which significantly lowers their risks and uncertainty of their tax position, e.g. double taxation and penalties. Ultimately, this allows them to focus on what they can do best: running their business.
Knowing that your transfer pricing model is solid, the client is better able to manage and monitor budgets with the final results which leads to the fact that your annual accounts are correct and thus your tax returns are accurate. This limits the risks of discussions with local tax authorities and increases the level of control. Furthermore, with respect to a possible business model restructuring or merger, having an up-to-date transfer pricing policy reduces the risk that any changes or differences might have an impact on the transfer pricing policy without any notice.
Finding the right TP adviser
Due to the increased scrutiny by tax authorities along with new documentation requirements, and envisaged new regulations in the future, being in control of your transfer pricing is very important. It is therefore very important that the TP adviser knows the needs of the client and can anticipate on global transfer pricing developments.
Transfer pricing should have an international approach, whereby specific local regulations play a significant role. A one sided approach or advice from an adviser that does not have sufficient experience or a global network could do more harm than good.
Choosing an adviser that is involved, has an extensive network and is on top of new developments is therefore crucial.
Transfer pricing should be aligned with the business.
Since transfer pricing is very specific to each situation, there is no one-size-fits-all approach that can be applied. Each business needs to be analysed and the situation assessed to determine the most applicable transfer pricing model and thus arm’s length pricing. It is our experience that businesses sometimes have a different approach in this regard than what tax authorities are expecting to see.
Without solid advice and support, a company can think they have a solid transfer pricing model and substantiation, but in fact do not meet the requirements as imposed by local law and tax authorities. In addition, although the international community is seeking for more coherence, unilateral measurements can have a big impact on local compliance.
The Future
International business keeps growing and cross border intercompany transactions will increase significantly. BDO has a strong leadership in the Mid-market and has a growth strategy focussing on corporate clients doing business in different countries.International structuring cannot be achieved without proper value chain analysis and transfer pricing documentation. Therefore, being in control of transfer pricing is key priority for multinational enterprises. We have a strong international network that has much experience in dealing with these type of companies. Within BDO global I am part of the Transfer Pricing Centre of Excellence, assisting with global transfer pricing challenges, further expansion of the network and facilitating best practices towards other BDO member firms. With this network we have the right resources for building and maintaining client relationship which to us is of key importance and providing the clients with services they need.
Company: BDO Nederland
Name: Sjoerd Haringman
Email: sjoerd.haringman@bdo.nl
Web: www.bdo.nl
Address: K.P. van der
Mandelelaan 40, 3062 MB, Rotterdam
Phone: 010 242 4600