Don’t underestimate transactions and pricing between your own companies

Transfer pricing has been one of the most sought-after services in Wellbens recently. The Treasury has taken an active interest in transactions not only between foreign, but also between domestic dependents. The essence is the correct setting of the transfer price, which should be set at the level of prices used between independent persons in comparable business relationships.

Thus, if you trade with related individuals or legal entities, you are obliged under the Income Tax Act to keep documentation for such transactions. At Wellbens, we will be happy to assist you in setting the correct transfer price and preparing complete transfer pricing documentation.

What is transfer pricing and why is it important for entrepreneurs?

Transfer pricing is a term that refers to the pricing of transactions between related parties.
A related party is:

1. a close person within the meaning of civil law,
2. an economically, personally or otherwise related person or entity,
3. a person or entity that is part of a consolidated whole for the purposes of consolidation.

The main importance of transfer pricing is to ensure that prices in related party transactions meet the requirements of an arm’s length relationship for tax purposes. In other words, it is about ensuring that revenues are not transferred from one entity to another without the economic substance of such a transfer.

According to the law, every entity trading with dependents is obliged to keep transfer documentation, not only when trading with foreign dependents, but also when trading with domestic dependents.

The transfer documentation is intended to establish the arm’s length price that should be used by the entity in a particular transaction with a related party.

Transfer documentation is kept for each tax period and the tax administrator has the right to request the tax subject to submit such documentation also outside the tax audit. The deadline for submitting the documentation is only 15 days from the date of receipt of the request and therefore it is recommended to prepare it in advance.

Our

Services

At Wellbes, we offer our clients a comprehensive coverage of transfer pricing duties

  • Analysis of transactions with dependants
  • Determination of the number of transactions that require separate documentation
  • Determination of the arm’s length price on the basis of a market analysis
  • Preparation of documentation and its submission to the client

Choosing an appropriate method for price comparison:

  • After-sales method
  • Independent market price method
  • Incremental cost method
  • Profit sharing method
  • Net trading margin method

Why Wellbens?

Wellbens was founded by a group of experienced consultants who understand the needs of modern companies and entrepreneurs. The main goal is to bring quality services, precise advice and real added value while using the latest technologies. We believe that you will also be attracted to the Wellbens style – pro-client, efficient, precise and modern.

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Your right contact at Wellbens

Steiniger Lukáš

Co-founder/CEO of Wellbens and a modern lawyer who knows the current trends in law, tax and business. He has spent part of his career working in an international law firm and developing his own business in law, tax and accounting, which has helped him to gain the necessary experience and knowledge in advisory services. Thanks to his special talents and skills, he provides our clients with the best advice on an international level with full support in their business activities.