Transfer Pricing

transfer pricing Do the new rules apply to your company? The Finance Bill 2010 introduces transfer pricing legislation in Ireland. Small and mediumsized enterprises will be exempt. The Finance Bill 2010 (published 4 February 2010) contains proposed... More

transfer pricing Do the new rules apply to your company? The Finance Bill 2010 introduces transfer pricing legislation in Ireland. Small and mediumsized enterprises will be exempt. The Finance Bill 2010 (published 4 February 2010) contains proposed transfer pricing rules to apply to connected party transactions. The new rules provide that income shall be adjusted upwards and therefore protect the Irish tax base. Why introduce transfer pricing rules? In the absence of transfer pricing rules, companies are free to transact with each company. In cross-border transactions, where one company is taxed at a higher rate than the other company, intercompany pricing can be set at levels to maximise jurisdiction with the lower tax rate. Such pricing can threaten the tax base of higher tax jurisdictions. Most developed countries have transfer pricing rules, therefore the introduction of these provisions in Ireland is bringing the Irish tax system in line with international best practice. R Less