Transfer pricing (TP) conflicts affect many UAE enterprises. When tax authorities believe that prices between connected firms are unfair, these problems frequently occur. It’s stressful and can harm your organisation’s finances and reputation if not managed properly.
You do not have to deal with all this yourself. The gap between you and the Federal Tax Authorities (FTA) can easily be bridged, with the help of a knowledgeable TP agent. The agent will explain your pricing practices, defend your case, and assist you in reaching a favourable resolution.
In the UAE, Tax Gian can serve as your TP agent and assist you in successfully resolving TP disputes.
Why Do Companies Need Professional Assistance in TP Disputes?
Setting internal prices is only one aspect of TP. Meeting stringent local and international regulations is always the goal. The “arm’s length principle,” which the FTA enforces, states that all related-party transactions must appear to be agreements between two separate businesses. You may be subject to audits and tax modifications if your pricing does not pass this basic test.
In the UAE, a skilled TP agent is well-versed with the extant regulations. They are aware of OECD recommendations, UAE tax rules and the industry-specific use of TP. They will assist you in lowering your risks, in minimising penalties, and in avoiding double taxation.
What You Can Get from a Qualified TP Agent?
- Pre-Dispute Evaluation and Guidance
TP agents in Dubai, like Tax Gian, can identify weak points in your pricing practices before a disagreement even begins. They will examine your records, verify that your charges are reasonable, and offer insightful counsel. Early problem-solving can help you avoid further roadblocks down the road. This is included in risk evaluations for TP. - Robust Documentation Assistance
Your documentation must be correct and full in order to deal with the FTA. This comprises the Master File, Local File, and the Country-by-Country Report for significant companies. All of these will be carefully prepared with the assistance of a TP specialist. This provides a solid foundation for your company in the event that an audit raises problems. - Acting as a Representative in Tax Audits
You need someone who can communicate with the FTA if they call. All of your communications with tax authorities can be managed by a TP agent. They will provide a thorough explanation of your TP techniques and support your claims with relevant data. It all comes down to handling correctly and expertly. - Settlement and Negotiation
Taking every disagreement to court is not always necessary. In many situations, a knowledgeable TP advisor may help you achieve a settlement that persuades FTA without resorting to legal action. Their ability to negotiate can quickly resolve the issue and lower tax exposure. - Support With MAP and APA
Your TP agent can help you navigate the Mutual Agreement Procedures (MAP) between countries if you are dealing with cross-border tax disputes. In order to avoid future disputes and provide clarity for future transactions, they can also assist you in applying for Advance Pricing Agreements (APA).
Why Do Companies Have Faith in Experts?
- Experience that Counts
Tax Gian and other seasoned TP specialists contribute years of practical knowledge in a variety of industries. They are aware of what functions well and poorly. - Tailored Assistance
Every business is unique. A competent TP consultant in the UAE creates a strategy that fits your unique requirements and business processes. - Recognised by the FTA
Your argument gains greater weight when you work with certified tax agents. Additionally, it enhances communication with tax officials and fosters confidence. - Complete-Service Assistance
Professional TP agents in Dubai support you at every stage, from the initial indications of danger to the last settlement.
Why Is Transfer Pricing So Difficult?
The OECD model serves as the foundation for TP regulations in the UAE. They cover all related-party transactions, such as:
- purchasing or selling products
- offering or receiving services
- use of patents or trademarks
- Loans or other financial agreements
Companies are required to demonstrate that these transactions adhere to the arm’s length concept.
Identifying related parties, keeping track of all transactions, analysing functions, risks, and assets, comparing with comparable third-party deals, and selecting the appropriate TP technique are all necessary for corporate entities to do this. Red flags during audits may arise if any of these processes are skipped.
The Expensive Price of Errors
There may be severe repercussions if TP rules are violated. For instance:
- Tax reassessments
- Significant fines/penalties
- Additional audits
- Double taxation
This holds true for companies based in both the free zones as well as in the mainland. Even taxpayers with a zero percent tax rate are subject to TP regulations if they do business with related parties.
Why opt for Tax Gian?
- Knowledge and Experience: The team at Tax Gian is made up of seasoned tax professionals that have extensive experience of transfer pricing concerns across a range of industries and legal systems.
- Tailored Solutions: We understand that every company is unique. Our solutions are tailored to meet your particular needs and objectives.
- Strong FTA Standing: We are authorised tax agents in the United Arab Emirates and enjoy a good relationship with the FTA. It allows our transfer pricing advisers to help you resolve problems through constructive dialogue and negotiation in compliance with UAE laws and regulations.
- Full Support: From pre-conflict consultation to litigation, we provide end-to-end support, ensuring a smooth process throughout the dispute resolution process.
