Transfer pricing and financial services: streamline and futureproof your approach

Transfer pricing continues to be a high priority area of focus for revenue authorities around the world. Pressure on the actual pricing of intercompany transactions has magnified, and documentation requirements, which for many large groups already encompassed a local file and a master file, are becoming stricter and more granular.

These growing requirements present particular challenges for many financial services groups, not limited to facing complexities in sourcing and gathering data previously not required on such a global scale. For insurers, the challenge will be further compounded by the difficulties associated with reinsurance pricing and the impact on risk, whereas for banks, these complexities will be intensified when assessing current arrangements for attributing free capital and pricing interest rate risk into products.

Dealing with transfer pricing complexities in financial services

With fiscal and prudential attention on transfer pricing elevated, financial services groups need to be secure and confident that the complexities they face are fully understood, particularly with transfer pricing arrangements involving intricate elements such as intangibles or risk transfer.

When sourcing solutions, insurers, banks and asset managers should look to streamline and futureproof their transfer pricing approach by reassuring themselves that:

• Transfer pricing is treated as a core service that offers both global reach and bespoke solutions.
• Dedicated transfer pricing expertise exclusively for financial services groups is available.
• There is the ability to tap into international transfer pricing skills and capabilities based on recognised country-by-country knowledge and expertise that offers solid local and global support.
• A global network of industry experts in international tax, law, insurance, banking and asset management are used to supplement and support solutions.
• There is a joined-up approach to transfer pricing that involves solid expertise in audit, compliance, consulting and technology.
• Transfer pricing teams are up to date with ongoing legislation, trends and challenges from tax authorities to provide relevant, value added advice to clients via a dedicated central team.

Having the right level of knowledge and capabilities to deliver transfer pricing solutions to the financial services sector requires specific, in-depth knowledge and experience. It also requires an approach that treats transfer pricing as a dedicated service based on a global and centrally operated internal knowledge bank; an approach underpinned by our centre of excellence.

By taking a top-down global approach and a bottom-up regional approach, we can ensure that all transfer pricing outcomes are covered. Mazars’ recognised abilities in country-by-country reporting provide the foundations for best practice transfer pricing solutions.

Taking a global approach

With greater international scrutiny of transfer pricing arrangements across the financial services sector, only a global, one-solution approach can bring simplicity to this fast-evolving issue. Operating in more than 100 countries around the world, we have the vital expertise in tracking developments such as new legislation and court/tribunal rulings in each jurisdiction. Through direct contact with our experts who have deep industry know-how, we can provide the necessary local and international financial services expertise. 

Our global transfer pricing community brings together specialists from across financial service sector disciplines, including legal experts and economists to help with value chain analysis: a vital tool to align transfer pricing with economic value creation and establish transfer prices for intangibles.

Transfer pricing services for the financial sector

• A dedicated centre of excellence providing customised support to financial services groups
• Diagnostic risk assessment to highlight transfer pricing risk exposure and optimise tax positions  
• In-depth strategic advice on all transfer pricing aspects
• Master file, local file and country-by-country reporting
• Value chain analysis and transformation
• Specific financial services sector economic analyses
• Defence analysis and support
• Complex reinsurance pricing
• Valuation of hard-to-value intangibles  
• Databases and tools to ease reporting
• Support you in meeting your documentation obligations through advanced technology

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