Multinational groups constantly evolve, grow, and consolidate, and operational facts and circumstances always change. Say a growing company decides to expand internationally. It may choose to incorporate new foreign subsidiaries that will operate a manufacturing facility in one country and a limited-risk distributor in another.

The tax department will probably pay a lot of attention to the proper transfer pricing for transactions between these related parties of the growing multinational group. When it does so, it should ensure that the intercompany transactions, including the arm’s-length pricing, are memorialized in written intercompany agreements. We’ll address the most common questions you might have about these agreements.Continue Reading How Intercompany Agreements Can Mitigate Transfer Pricing Risk