Transfer pricing in Ukraine – a set of specific rules for establishing values for tax purposes. It is based on the "arm's length" principle, which implies the expansion of tax liabilities of related business companies to the level of unrelated ones. There is an important condition: certain financial, commercial transactions must be observed.
Basic rules, transfer pricing principles
In general, it is important to understand the transfer pricing of – is the sale of services or goods by persons who are interdependent, at prices set within the firm. It is necessary for the redistribution of general income. Important: business companies located in countries with lower taxes remain the winners. The main goal – minimize taxes.
A lot of attention has been paid to transfer pricing today, especially in recent decades. The reason is simple – raising taxes, unwillingness to pay them. In Ukraine, the main provisions are reflected in Article 39 of the Tax Code, but they have recently been somewhat modernized. Transfer pricing 2020 in the Tax Code was updated on May 23. Pricing Law No. 466 has come into force, it covers a large number of tax issues at once.
Of course, it is not easy for the owner of a company that is engaged in foreign economic activity to understand these issues on their own. Therefore, the specialists of "Key Solutions" come to the rescue.
Transfer price – This is the estimated intrinsic value and all operations are performed on it. Relevant for large organizations consisting of several business units, and there are contractual relations between them. Each side pursues its own interests. In fact, modern business – a kind of mini-market with its own rules of the economy.
Markers of relatedness of persons in transfer pricing
The transfer pricing of an organization in Ukraine is based on two main markers of connected business companies:
- use of identical logos on documentation forms;
- signing of commercial documents, reporting by individuals with the same surnames.
Example: if you do not have transactions with non-residents, you do not need to worry. There is no need to submit any reports to banks or fiscal authorities. In other cases, we suggest contacting us – at Kay Solutions.
Key Solutions transfer pricing services
Our main services:
- preparation of reports, including written ones;
- providing recommendations;
- price level definition;
- diagnosis of operations of the financial department by modern methods for comparability;
- selection of jurisdiction;
- representing the interests of the client in the fiscal authorities, the judicial organization.
Do you want to be ready for any SFS inspection? Learn more about transfer pricing and taxation now!
Your benefit:
- permanent access to documentation;
- Reliable data protection.
Remember, don't take transfer pricing matters lightly. Leads to serious consequences. The fiscal authority always makes its own calculations, if the results do not match or other errors are found, claims will arise and fines will be issued.
At the moment, transfer pricing is one of the most risky institutions of tax law. If there are no clear rules in the law, then both the State Fiscal Service and business representatives try to interpret everything in their favor. And of course, the largest fines will follow: they can reach 30-40% of the identified arrears.
Therefore, it is important for business representatives to receive methodological recommendations and consultations in a timely manner.
Many companies have already gotten into big trouble with transfer pricing. And meanwhile, it is a very effective tool. Can penalties be avoided? Yes, you just need to discuss with the specialists of "Key Solutions" tax optimization.
Transfer pricing – this is the establishment of certain prices between related organizations. The difference between market and transfer – the ability to redirect profits from jurisdictions with high taxation to those where it is absent at all is minimal. The profit is obvious.
Diagnosis of controlled transactions
Controlled are foreign economic transactions with related parties. «Key Solutions» will provide comments based on the legislation of Ukraine for each of them.
Preparation of transfer pricing documentation
Because with the introduction of transfer pricing the State Fiscal Service has more opportunities to obtain information, it is necessary to keep the documents in order.
It is necessary to prepare documentation that will withstand challenges from the tax authorities.
Want to build an wholesalean imal transfer pricing control system? The specialists of "Key Solutions" will help you with this.
Don't be afraid of the problems and inaccuracies of the legislation in this area. All our specialists have over 10 years of experience and will give clear and understandable recommendations to your business, taking into account all the nuances.
The taxpayer is obliged to notify the tax authorities of the completed controlled transactions. An extraordinary inspection may be scheduled based on the notification.
Our team works with Ukrainian and foreign businesses and helps to prepare documentation. These documents clearly justify the marketability of the price, so there will be no claims against you.
We cooperate with the best international pricing agencies. They meet the highest requirements of international price regulators.
In the most negative scenario, we will help establish the truth in court. We have experience in successfully handling such cases, despite the increased level of their complexity.
Key Solutions specialists can explain the process in the economy, its profitability in more detail. It is enough to contact us in a convenient way. Experts will help you quickly deal with the problem and prevent the accrual of fines. We will answer all questions on terms for transfer pricing.