Taxes Archives - Page 8 of 17 - Academy of Tax Law

Understanding the Transactional Net Margin Method (TNMM) in Transfer Pricing

The Transactional Net Margin Method (TNMM)The Transactional Net Margin Method (TNMM) is one of the five primary transfer pricing methods recognised under the OECD Transfer Pricing Guidelines. TNMM is applied to evaluate whether the conditions of a controlled transaction between associated enterprises are at arm’s length. Unlike traditional transaction methods, which directly compare prices or gross margins, TNMM compares the net profit margin relative to... More is a pivotal tool in transfer pricingTransfer pricing is a fundamental concept in international taxation that defines the pricing methods and rules applied to transactions between related entities within a multinational enterprise (MNE). In the context of tax regulations, it governs how prices for goods, services, or intangibles (such as intellectual property) are set when these items are exchanged between different branches, subsidiaries, or affiliates of... More, used to ensure that transactions between associated enterprises are conducted at arm’s length. This method compares the net profit margin of a taxpayer from a controlled transaction with that of comparable uncontrolled transactions.

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The Cost Plus Method in Transfer Pricing

International, International Tax, Tax Dispute Resolution, Transfer Pricing, Transfer Pricing Methods / Dr Daniel N Erasmus

The Cost Plus Method is a widely used approach in transfer pricingTransfer pricing is a fundamental concept in international taxation that defines the pricing methods and rules applied to transactions between related entities within a multinational enterprise (MNE). In the context of tax regulations, it governs how prices for goods, services, or intangibles (such as intellectual property) are set when these items are exchanged between different branches, subsidiaries, or affiliates of... More for determining arm’s length prices between related entities. This method is particularly useful for manufacturers, service providers, and other businesses that add value to goods or services before transferring them to related parties.

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Understanding the Comparable Uncontrolled Price (CUP) Method in Transfer Pricing

International, International Tax, Tax Dispute Resolution, Transfer Pricing, Transfer Pricing Methods / Dr Daniel N Erasmus

The Comparable Uncontrolled Price (CUP) MethodThe Comparable Uncontrolled Price (CUP) Method is a transfer pricing approach that assesses whether the price charged in an intercompany transaction between related entities is consistent with the arm’s length principle. The arm’s length principle, a fundamental concept in transfer pricing, requires that the conditions of a transaction between associated enterprises be equivalent to those which would have been agreed... More is one of the primary transfer pricingTransfer pricing is a fundamental concept in international taxation that defines the pricing methods and rules applied to transactions between related entities within a multinational enterprise (MNE). In the context of tax regulations, it governs how prices for goods, services, or intangibles (such as intellectual property) are set when these items are exchanged between different branches, subsidiaries, or affiliates of... More methods used to determine arm’s length prices for transactions between related entities.

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Danish Supreme Court Upholds Transfer Pricing Adjustment in Maersk Oil Case

Denmark, Dispute Resolution, International, International Tax, TP Case Summaries / Dr Daniel N Erasmus

Summary of the Danish Supreme Court’s landmark ruling on transfer pricingTransfer pricing is a fundamental concept in international taxation that defines the pricing methods and rules applied to transactions between related entities within a multinational enterprise (MNE). In the context of tax regulations, it governs how prices for goods, services, or intangibles (such as intellectual property) are set when these items are exchanged between different branches, subsidiaries, or affiliates of... More in the Maersk Oil case, with implications for multinationals and tax authorities worldwide.

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Understanding the Resale Price Method in Transfer Pricing

International, International Tax, Tax Dispute Resolution, Transfer Pricing, Transfer Pricing Methods / Dr Daniel N Erasmus

The Resale Price Method in Transfer Pricing is a fundamental approach used by multinational enterprisesWhat are Multinational Enterprises (MNEs)? Multinational Enterprises, commonly referred to as MNEs, are corporations that operate in multiple countries through various subsidiaries, branches, or affiliates. These entities maintain a central management structure while leveraging diverse resources, labour markets, and customer bases across borders. The fundamental aspect that distinguishes MNEs from other corporate forms is their cross-border activity, which can include... More (MNEsWhat are Multinational Enterprises (MNEs)? Multinational Enterprises, commonly referred to as MNEs, are corporations that operate in multiple countries through various subsidiaries, branches, or affiliates. These entities maintain a central management structure while leveraging diverse resources, labour markets, and customer bases across borders. The fundamental aspect that distinguishes MNEs from other corporate forms is their cross-border activity, which can include... More) to ensure compliance with international tax regulationsTax laws form the backbone of any nation’s revenue system, setting the rules that govern how individuals and corporations contribute financially to support government functions. These laws define the types of taxes, the applicable rates, and the regulations regarding payment and compliance. They also outline the rights and obligations of taxpayers, ensuring a balanced and fair approach to funding public... More.

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Luxembourg vs “LLC AB”: Luxembourg Court Upholds Debt Classification of Interest-Free Loan in Transfer Pricing Case

Dispute Resolution, Europe, International Tax, Luxembourg, Tax Dispute Resolution, TP Case Summaries, Transfer Pricing / Dr Daniel N Erasmus

Luxembourg court rules interest-free loan qualifies as debt, allowing notional interest deduction in landmark transfer pricingTransfer pricing is a fundamental concept in international taxation that defines the pricing methods and rules applied to transactions between related entities within a multinational enterprise (MNE). In the context of tax regulations, it governs how prices for goods, services, or intangibles (such as intellectual property) are set when these items are exchanged between different branches, subsidiaries, or affiliates of... More case with implications for multinationals.

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The Arm’s Length Principle in Transfer Pricing

International, International Tax, Tax Dispute Resolution, Transfer Pricing / Dr Daniel N Erasmus

Learn about the Arm’s Length Principle in Transfer PricingTransfer pricing is a fundamental concept in international taxation that defines the pricing methods and rules applied to transactions between related entities within a multinational enterprise (MNE). In the context of tax regulations, it governs how prices for goods, services, or intangibles (such as intellectual property) are set when these items are exchanged between different branches, subsidiaries, or affiliates of... More, its importance, methods, and why consulting experts like TRM is crucial for compliance and risk management.

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Understanding the Burden of Proof in Transfer Pricing: Insights from Recent Court Cases

International, International Tax, Tax Dispute Resolution, TP Case Summaries, Transfer Pricing / Dr Daniel N Erasmus

Explore the critical role of the burden of proofThe burden of proof is a foundational principle in legal proceedings, requiring a party to demonstrate the truth of their assertions to the requisite standard of evidence. In tax law, the burden of proof often determines which party—typically the taxpayer or the revenue authority—must establish that a transaction, deduction, or tax position is justified. This principle ensures fairness and clarity... More in transfer pricingTransfer pricing is a fundamental concept in international taxation that defines the pricing methods and rules applied to transactions between related entities within a multinational enterprise (MNE). In the context of tax regulations, it governs how prices for goods, services, or intangibles (such as intellectual property) are set when these items are exchanged between different branches, subsidiaries, or affiliates of... More through analysis of recent Dutch, Czech, and Italian court cases.

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Netherlands vs “Lux Credit B.V. – Ruling on Arm’s Length Principle in Intra-Group Financing Case

International Tax, Netherlands, Tax Dispute Resolution, TP Case Summaries, Transfer Pricing / Dr Daniel N Erasmus

Analysis of Dutch court ruling on arm’s length principle in intra-group financing. Key insights for multinationals on transfer pricingTransfer pricing is a fundamental concept in international taxation that defines the pricing methods and rules applied to transactions between related entities within a multinational enterprise (MNE). In the context of tax regulations, it governs how prices for goods, services, or intangibles (such as intellectual property) are set when these items are exchanged between different branches, subsidiaries, or affiliates of... More and tax risk managementTax risk management is a structured process used by organizations, particularly multinational enterprises (MNEs), to identify, assess, and mitigate potential risks that arise in relation to tax compliance, reporting, and planning. It plays a crucial role in ensuring that a company’s tax obligations are managed in a way that minimizes risk exposure while maximizing efficiency and strategic value. More.

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The Importance of Thorough Economic Analysis in Transfer Pricing

Dispute Resolution, International, International Tax, Tax Dispute Resolution, Transfer Pricing / Dr Daniel N Erasmus

Discover why thorough economic analysis in transfer pricingTransfer pricing is a fundamental concept in international taxation that defines the pricing methods and rules applied to transactions between related entities within a multinational enterprise (MNE). In the context of tax regulations, it governs how prices for goods, services, or intangibles (such as intellectual property) are set when these items are exchanged between different branches, subsidiaries, or affiliates of... More is essential for compliance and profit optimization. Learn how experts like TRM can help.

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