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46 Transfer Pricing - Coggle Diagram
46 Transfer Pricing
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Pricing arrangement for
the transfer of goods, services and intangibles
between associated persons
associated person
two persons/Co that
- one has control over the other
- individuals who are relatives of each other
- persons both of whom are controlled by some other person
Control:
share holding > 20%andOne party
- depends on proprietary rights(patent, know how, trademark) of the other person; or
- has biz activities with the other person and is not carried out at arm's length basis; or
- is able to appoint >1 directors in the other Co
Problems
transactions between associated person
may not be determined by mkt forces
due to commercial & financial relationship of
the related parties.
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