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Service Level Agreement Transfer Pricing

Import existing intercompany agreements and generate default templates that can be customized for each global transaction in any jurisdiction. Avoid repeated data entry and use built-in logic to speed up the design process. There`s no need to restart contracts from scratch, and presentation rules help you avoid mistakes. One possible scenario is that the corresponding supply agreements are already in operation, but are not yet documented. For example, services at headquarters may have been provided from a given historical date, as reflected in the functional analysis. In this situation, it may be possible to create a document after the event that recites what actually happened and records the key terms of delivery. The document must be dated if it is actually signed, but it may relate to the historical effective date of the transaction. This approach may be more difficult to justify if the agreements are unusual or if a particular contractual risk profile is not clearly demonstrated by the behaviour of the parties, such as for example. B limited risk allocation agreements. The rules in many countries require taxable persons to prove that the prices calculated are within the limits of the prices allowed by the transfer pricing rules. If these documents are not drawn up in a timely manner, sanctions may be applied as indicated above. It may be necessary to obtain documents before filing a tax return in order to avoid these penalties. [78] The documentation of a taxable person must not be invoked by the tax authorities in any case of law authorising an adjustment of prices.

Some systems allow the tax administration to ignore information that is not provided in a timely manner by taxpayers, including such prior documentation. India requires that the documentation be available not only before a return is filed, but also that the documentation be certified by the accountant preparing a business return. Intercompany agreements are fundamentally different from those with third parties (also known as trade agreements). An intercompany contract is signed by two companies that are part of the same group.. . . .