Transfer pricing意思

Transfer pricing refers to the price at which goods or services are transferred between related parties within an enterprise or a corporate group. These related parties can be subsidiaries, divisions, or branches of the same company in different countries. Transfer pricing is a key aspect of international tax law and corporate finance, as it determines the allocation of profits and taxes among the various subsidiaries of a multinational corporation (MNC).

The purpose of transfer pricing is to ensure that transactions between related parties are conducted at arm's length, which means that the price should be the same as if the parties were unrelated and independent. This is important because the prices at which transactions occur within an MNC can significantly affect the amount of tax the company pays in different countries.

For example, if a subsidiary in a low-tax country sells goods to a subsidiary in a high-tax country at an inflated price, the subsidiary in the high-tax country will report lower profits, and thus pay less tax. Conversely, if the subsidiary in the low-tax country sells goods to the subsidiary in the high-tax country at a reduced price, the subsidiary in the low-tax country will report lower profits, and the subsidiary in the high-tax country will report higher profits, potentially leading to higher taxes.

Governments and tax authorities around the world have established rules and regulations to prevent MNCs from manipulating transfer prices to avoid taxes. These rules aim to ensure that profits are reported and taxed in the countries where the economic activity that generates those profits actually takes place.

Transfer pricing can involve a wide range of transactions, including the sale of goods, the provision of services, the licensing of intellectual property, and the borrowing of money. MNCs often have dedicated transfer pricing departments or hire external consultants to help them establish and document transfer prices that comply with tax laws and regulations.