Transfer Pricing Defense
Transfer Pricing Defense

In Transfer Pricing, the defense mechanism from the Taxpayer’s perspective is an essential element where the Tax Authorities calls for Transfer Pricing Documentation where an Arm’s Length nature of transaction needs to be proven. Such a defense mechanism could be proactive or reactive.

A proactive mechanism includes matters like entering into the ‘Advance Pricing Agreements’ (APA) with the Tax Authorities (Government) for upfront determination of Transfer Pricing for future and ‘Safe Harbour’ regimes where the Taxpayer is expected to maintain minimum profitability as suggested by the Government. It is possible to enter into an Advance Pricing Agreement for the purpose of determination of Transfer Pricing in India for a period of 9 consecutive years out of which 5 years are forward looking and a roll back provision for past 4 years is also included. A reactive Transfer Pricing defense mechanism includes representation before the Transfer Pricing Authorities including detailed submissions on the Transfer Pricing positions and policies. Further it also includes instigation resolution before the Dispute Resolution Panel, Commissioner (Appeals), Tax tribunals, Facilitation at High courts and Supreme Court.

Our solution in the Transfer Pricing dispute resolution include:

  • Transfer Pricing Representation along with Strategy Formation
  • Advance Pricing Agreements
  • Safe Harbour Representations
  • Transfer Pricing Litigation Strategy Formation
  • Representations at Dispute Resolution Panel along with other appeal levels
  • Representations at Income-Tax Tribunals
  • Facilitations for High Courts and Supreme Court
  • Transfer Pricing File Built-up to be ready for Transfer Pricing Assessment
  • Analysis of Transfer Pricing Risk Profiling
  • Transfer Pricing Representation along with Strategy Formation

    We assist in representing your case before the transfer pricing authorities in India. The ideal way to represent is to think through the strategy and essential elements in the transfer pricing case to understand if there are any risk areas which could be pre-identified and accordingly addressed. Such analysis could only come through a specialist experience.

  • Advance Pricing Agreements (APA)

    APA is a proactive way of reducing the future litigation at the multinational company. It is entering in to an agreement with the Central Government declaring and fixing your transfer pricing mechanism. One can get clarity on 9 years of transfer pricing due to execution of such APA. We assist multinationals in end-to-end processing of the APAs with the Government.

  • Safe Harbour Representations

    Once the taxpayer opts for the safe harbour regulations, the tax authorities through its transfer pricing officers may like to understand whether the application is a valid application or shall be rejected. We assist companies with representations before the transfer pricing authorities to explain the positions undertaken by the clients and accordingly justify the option of safe harbour.

  • Transfer Pricing Litigation Strategy Formation

    Clients may have their internal litigation experts and litigators on their board. They often reach out to us for a formal strategy build up around transfer pricing litigation strategy and take prior approvals of their strategy from the firm.

  • Representations at Dispute Resolution Panel along with other appeal levels

    DRP is the 1st level appellate authority for transfer pricing matters. We assist our clients with preparation for the appeal, application for the appeal as well as representations for the appeal.

  • Representations at Income-Tax Tribunals

    We assist our clients with strategizing, drafting and active representations at the tax tribunal level. Tax tribunals are an important level in tax litigation, as it is the final fact-finding authority. It is essential that all facts are well placed before this level and argued accordingly. We work with a panel of litigation experts along with in-house experts at TransPrice.

  • Facilitations for High Courts and Supreme Court

    We facilitate our clients for appeals at a higher level where we study the case, strategise and brief the counsel for the case at High Court and Supreme Courts.

  • Analysis of Transfer Pricing Risk Profiling

    We undertake detailed review of the documentation undertaken by the taxpayer in the past and understand the risk involved in the model and the documentation. We suggest the corrective action for bringing the transfer pricing in alignment for past and for future.