An Introduction to Transfer Pricing in China

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In this presentation, Shirley Chu, Transfer Pricing Services Manager from Dezan Shira & Associates' Dalian office, will provide the basics of transfer pricing in China and how it affects multinational companies today.

Transfer pricing is a reality for any multinational company. As a result of a globalized economy and increasing complexity in business models, tax authorities around the world are actively protecting their revenue base through the introduction of transfer pricing regimes, which focus on the taxation of profits that stem from related party transactions. These transfer pricing regimes will typically provide guidance to taxpayers on how related party transactions should be priced and how taxpayers can discharge the burden of proof that their transfer pricing arrangements comply with the arm’s length standard.

If designed and implemented in the early stages of a new venture, a transfer pricing system can complement and support an MNC’s business model and commercial objectives, as well as optimize its global effective tax rate.