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Transfer pricing is the method of setting prices for transactions between related entities of the same company, especially when they operate in different countries. These prices must follow the arm’s length principle, meaning they should be similar to prices charged between independent parties, to comply with tax laws.
Common transfer pricing methods include:
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Comparable Uncontrolled Price (CUP) Method
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Cost Plus Method
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Resale Price Method (RPM)
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Transactional Net Margin Method (TNMM)
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Profit Split Method
Choosing the right method helps avoid tax disputes and ensures compliance. Prakash K Prakash Consult assists businesses with transfer pricing analysis, documentation, and regulatory compliance.
Website : www. pkpconsult. com
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What do you mean by transfer pricing?
transfer pricing is in the case of transferred with in the organisation the pricing of contribution for assets ,
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What do you mean by transfer?
transfer pricing is in the case of transferred with in the organisation the pricing of contribution for assets ,
What is the nature of transfer pricing?
what are the nature of transfer
What do you mean by pricing?
transfer pricing is in the case of transferred with in the organisation the pricing of contribution for assets ,
What are the advantages of Transfer Pricing?
Transfer pricing is a business tool used by many companies. This enables companies to keep profits high, no matter what the economy is doing. The objectives of transfer pricing are, therefore, keeping the profit margin high by over charging or under charging on goods and services. Usually this is done when a company has a brances in multiple companies. For instance, Wal-Mart has merchandise made in China for very low cost, then it is brough to America where it is sold at higher cost. This enables the company to reap large profits.
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The most common method of interest calculation used in financial institutions is compound interest.
What is Value Based Pricing?
Value based pricing is a method of pricing a product based on perceived value. This method sets aside the issue of production and distribution costs and focuses more on what the buyer is willing to pay. This method of pricing is the most popular way to bring more profits to a company's table.
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