What to Look For in a Transfer Pricing Service Provider

Multinational companies (MNCs) and those considering expansion overseas face a growing number of international tax planning and compliance challenges. It can be nearly impossible to keep up with all the changing regulatory, legislative and tax requirements.

Noncompliance with transfer pricing rules can have negative consequences for MNCs. It can potentially lead to double taxation, interest on tax underpayment, penalties, and extended disputes with tax authorities—including litigation.

In previous blogs, we highlighted many key facets of transfer pricing, including transfer pricing basics and methods used to calculate transfer prices, an explanation of profit shifting and the Base Erosion and Profit Shifting (BEPS) Initiative that seeks to combat it, and an explanation of country-by-country (CbC) reporting requirements. Yet when it comes to navigating this complex landscape, your business should rely on trusted experts who possess the depth of experience and expertise necessary to make all the right moves on your behalf.

Like any international tax discipline, transfer pricing is highly specialized. Some of the qualities to look for in a transfer pricing service provider include:

• An ear to the ground. Your international tax partner should track all the latest developments in the global marketplace to keep you in compliance and plan strategically.
• Specialized expertise as needed—wherever it’s needed. At times, you may need very specific expertise. Your transfer pricing service provider should have access to experts globally who they can call on to assist in such matters and help you compete successfully in a dynamic international arena.
• The ability to strategically plan and provide proper documentation.
• Experience with the following:
  • Foreign tax credit planning
  • Inpatriate and expatriate tax services, including foreign bank account and asset reporting
  • Corporate international tax strategic tax planning and consulting
  • Cross-border restructuring, including entity selection and related U.S. tax planning
  • IC-DISC tax planning and structuring; and International mergers and acquisitions

The rules surrounding transfer pricing offer businesses the general flexibility to set the conditions around their intercompany transactions. As such, having the ability to plan can enable your business to optimize the allocation of income within its larger corporate structure.

Questions about Marcum’s international tax services? Please contact Michael Milazzo, Partner, Tax & Business Services.