Case Study 6

Transfer Pricing Document Preparation

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Understanding Transfer Pricing

Transfer pricing involves deciding the cost of goods, services, and intangible items that move between companies that are connected. These prices should be fair and like what's used in the open market.

Companies are connected if they control each other or are controlled by the same party, directly or indirectly.

The arm's length price is a fair price that similar things would have in an open market or a reasonable profit between connected companies.

What is Transfer Pricing Documentation?

Transfer pricing documentation is like proof. It shows that connected companies are doing business at a fair price.

You need Contemporaneous Transfer Pricing Documentation if:

  • Your yearly business income is more than RM25 million and your transactions with connected companies are over RM15 million, OR

  • You give financial help of more than RM50 million.

If the above doesn't apply, you need Abbreviated Transfer Pricing Documentation.

Challenges for Companies

Companies might not know the rules for transfer pricing, find it hard to get similar company data, or struggle with documentation.

How KTP Can Help

Our team can guide you through it all:

  • We check your transfer pricing documents to make sure they're right.

  • We see if the pricing method you're using is reasonable.

  • We look at your contracts with others to make sure they're good.

Positive Result

By having proper transfer pricing documentation, your business is better protected in case of a tax audit. KTP ensures that you have a strong defense if needed.

Ready to set sail towards your financial horizon?
Let’s get in touch with us.


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