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Transfer pricing policy for an Indian multinational software company

Engagement: SKP was engaged by an Indian multinational software company to formulate a transfer pricing policy that maximises after-tax cash flows for the group while balancing India and the United Kingdom’s transfer pricing regulations.

We recommended the Cost Plus method to determine the arm’s length price, with searches on the UK’s database for comparables.

Value Delivered
Our solution led to optimising the tax exemption benefits in India. The effective tax rate for the group as a whole was as low as 1.59%. We also provided transfer pricing representation in the UK and India and the policy was accepted by the UK and Indian revenue authorities.