The system of Transfer Pricing in a multinational

• Autor(a) principal: Mendonça, Inês Alves Palhavã da Costa
• Data de Publicação: 2015
• Tipo de documento: Dissertação
• Idioma: eng
• Título da fonte: Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)
• Texto Completo: http://hdl.handle.net/10362/15608
• topic: Transfer pricing methods; Standard costs; Responsibility centres; Performance evaluation; OECD Transfer Pricing Guidelines; Arm’s Length Principle; Domínio/Área Científica::Ciências Sociais::Economia e Gestão

Transfer prices are used by the majority of firms worldwide when intermediate products or services are transferred within the same organization. These prices are reported as revenue for the selling entity (division, unit, department etc.) and as cost for the buying entity. Nevertheless, transfer prices lead to many disputes among managers in the same organization as transfer prices influence the performance of their entities. In cross-border transactions, transfer prices can be used by firms to reduce corporate taxes and thus, increase total firm profits. In order to fight against this firms’ practice, tax authorities require firms to establish a transfer pricing system in accordance with OECD1 Transfer Pricing Guidelines.