Transfer Pricing: History and Leaders

According to verified sources (TPWeek), transfer pricing in Ukraine has undergone significant transformations from 2013 to 2016 with rather harsh criticism of the TCU by transfer pricing specialists (hereinafter – TP) and business circles regarding the underdevelopment of TP regulation by laws regarding related parties.

Everyone expected that, starting from September 2013, new rules would start, which would keep up with the OECD’s recommendations on TP issues, and would bring more clarity.

For not submitting reports, the tax authorities may impose a rather significant fine on the taxpayer for 7 years if the companies do not give enough importance to this, and besides, the SFS is currently undergoing special training for “transfer auditors”, has access to the databases Amadeus, Orbis, RUSLANA, which means that guidelines appeared on how to prepare TP documentation. Big 4 companies are unquestionably leaders in this area. I am sure that it was them who helped legislators to develop mechanisms for determining ordinary prices for TP, which would be fair and truly market-based. Like all our best expectations in life do not come true, so the laws are not perfect and not protected from arbitrary interpretation, because they contain complex, unclear, vague and incorrect formulations, which in certain situations will lead to abuse of the SFS and will work against the interests of taxpayers.

A big effort was made in improving the provisions of the TP by the representative company of the Big 4: explanations in the articles, development of legislation, as well as new concepts and meetings with business, using international experience. But along with Big 4, there are other network audit companies, such as HLB Ukraine, DFK, RSM-APIK, which are also highly professional in TP matters. Specialists of the audit firms HLB Ukraine, DFK, RSM-APIK have legal access to the databases of the programs Amadeus, Orbis, RUSLANA and other sources that allow you to quickly and efficiently check comparative prices, profitability, as well as prepare documentation for TP and prepare a report.

Methods and approaches, calculations and analysis are based on the international experience of HLBI, DFK, RSM-APIK and other companies. Network companies in each country in the world have their own independent societies marked HLB, DFK, RSM-APIK. They use a reliable and high-quality methodology and practice that has been worked out over the years, track individual supply chains, intra-group supplies and solve complex problems in analysing a large range of goods, raw materials, materials, etc., making generalizations and drawing right, fair conclusions, recommendations, analysing and mitigating tax risks, especially for intra-group transactions, developing a TP policy, informing clients about international TP practices and about new ways to regulate TP. The companies HLB Ukraine, DFK, RSM-APIK and others also have impeccable and serious experience in TP.

Valerii Bondar
Managing Partner of HLB Ukraine


April 26, 2016

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