United Kingdom
How BDO can help
Why BDO?
- An integrated multi-disciplinary approach
- Tailored and practical documentation
- Real value added
- Breadth of offering
- Sector and transaction expertise
- Supply Chain reconfiguration
- Dispute resolution experience
- Global reach
- Accessibility, transparency and responsiveness
- Partner-led
An integrated multi-disciplinary approach
Our multi-disciplinary approach means that we provide practical and fully integrated tax, valuation and economic solutions alongside specific sector experience to meet your commercial and operational needs.
Our transfer pricing specialists are all fully trained in general taxation and are able to identify and address any tax pitfalls and opportunities highlighted by our economic analysis and documentation work. Our goal is to develop and help implement commercial and tax-efficient transfer pricing policies and to adapt them as and when new rules emerge or circumstances change.
Our integrated transfer pricing solutions approach:
Getting your transfer pricing policy right and documenting it appropriately is therefore becoming ever more important. We provide a full range of transfer pricing services including the preparation and review of documentation, dispute resolution support, advice on supply chain management and reconfiguration and integrated tax planning.
Tailored and practical documentation
We provide tailored and practical transfer pricing documentation designed to meet your business’ specific documentation needs, wherever you may operate globally.
Our clients' needs for documentation vary enormously. We tailor our documentation offering to meet local, regional and global requirements. Where appropriate, we will help develop and implement global transfer pricing documentation strategies, coordinating the process of preparing and compiling multilateral documentation in an efficient manner which is acceptable to authorities in different countries.
The approach we typically adopt in this regard is to prepare a 'core' document package that is used by each country and augmented by separate country reports in the efficient preparation of documentation to satisfy each country's specific requirements. However, there is no 'one-size-fits-all' answer when compiling global documentation. The specific application of functional analyses, economic analyses, financial analyses, and the selection of the most appropriate transfer pricing methodology will vary from country to country. Our experience in tailoring transfer pricing documentation to address these issues means that our clients can be comfortable in the knowledge that their documentation is sufficiently rigorous and that it is developed in an effective manner.
Knowing how to dovetail national requirements with an efficient global and regional approach is key, as is an appreciation of the appropriate economic analysis and the benchmarking of transactions (a critical element of any transfer pricing work) as a justification strategy. In this regard, the aim of the recent EU Code of Conduct on transfer pricing documentation to reduce the EU-wide documentation burden (and potential penalty exposure) of groups is laudable, but making the Code work in practice to your benefit, whilst integrating the approach postulated by the Code into a compliant global documentation set, is critical.
Real value added
We look to identify where we can add real value. We are not restricted by a product-driven or formulaic-driven approach. We provide bespoke advice which is tailored to your specific needs. We seek to identify and address how we can cut the cost of documentation preparation and maintenance by -
- adopting tailored and non-formulaic approaches to documentation preparation
- better controlling and streamlining the process of documentation preparation and benchmarking and the effective use of our most appropriate resource
- more effective information collation and dissemination, using our proprietorial web-based software allowing our clients and BDO colleagues internationally to appropriately monitor and control the documentation development process in real time.
Breadth of offering
Our integrated international tax, corporate tax, VAT, employment tax and valuations offering means we can provide a fully comprehensive solution.
You can be confident that the transfer pricing solutions we offer take full account of other areas of taxation and that the impact on each area has been fully considered.
In addition, we can provide assistance with cost sharing arrangements, advance pricing agreements and transfer pricing risk assessments. We can also assist with the identification of corporate governance risk management exposures. Apart from transfer pricing analyses, we can also provide general economics research support which includes effective tax rate studies, industry surveys and other general research, and we have the databases to support these efforts. Our valuations team also provide valuation services in relation to intellectual property and other asset classes.
Sector and transaction expertise
We have experience of a very wide range of sectors and transactions and an in-depth understanding of the key economic and tax issues.
Our sector experience includes:
- Financial Services
- Funds/ private equity
- Healthcare
- Information technology
- Leisure and Hospitality
- Professional Services
- Real Estate and Construction
- Retail
- Technology, Media and Telecoms
Our transactional experience encompasses:
- Intra-group services
- Intra-group goods
- Financing and intra-group debt structuring
- Intellectual property planning, valuation, modelling and documentation
- Full supply chain analyses
We have access to a very broad range of databases and other materials across our global network which provide us with the widest selection of corroborative search material to enable us to construct robust documentation and well-supported benchmarking conclusions.
Supply Chain reconfiguration
Transfer pricing affects a business’ entire supply chain – right through from research and development to after-sales service. Business constantly develops to meet changing market conditions and customer demands, and to grow and improve profitability. Business change will result in changes in functions, risks, organisational and other business structures, asset ownership, financing requirements and in flows of goods and services. Improving performance will entail cost control and improvement in business processes.
We have undertaken work for groups operating in all parts of the supply chain from R&D companies, manufacturers (fully-fledged or contract), distributors (marketer distributors, pure distributors, limited risk distributors and commission agents) to fully integrated manufacturer/distributors and professional partnerships.
Our documentation and planning work has addressed functions (and risks encountered) along the entire supply chain spectrum:
We have experience in a wide variety of economic techniques and economic modelling and take pride in our ability (frequently in conjunction with other senior economists and tax practitioners in the BDO network around the world) to devise, often unique, innovative solutions to our client’s transfer pricing challenges. Solutions we have delivered include cost sharing, shared services centres, revenue sharing, IP valuation and royalty benchmarking techniques, and debt structuring.
Tax will always be a significant factor in any exercise to improve the supply chain structure, and the management of a business’ global tax exposure should ideally be an integral part of the management of any change to the supply chain. However, it is all too often ignored or considered as an after-thought.
BDO’s approach to dealing with issues that arise from changes to the supply chain is a tailored and practical one, reflecting our multi-disciplinary approach to transfer pricing. We will review transfer pricing methods, advise on the adoption of an appropriate transfer pricing model and address the various tax exposures and opportunities which derive from or, indeed, may drive the supply chain reconfiguration. We remain aware of the other commercial factors inherent in any such exercise including cash flow, control over audit and other risks, and the inevitable human factors.
Dispute resolution experience
An increasing number of countries now impose transfer pricing documentation requirements, most of which can be onerous for the businesses affected. Many companies do not have good quality transfer pricing documentation and this leaves them exposed when a tax authority requests their documentation. Our experience is that an unprepared taxpayer is in danger of letting a tax authority dictate the terms in an enquiry which could very well lead to an unfavourable tax adjustment.
A very significant proportion of our work involves assisting our clients with enquiries from tax authorities and the negotiation of appropriate settlements. Our experience of what tax authorities look for helps our clients reduce and control the risk of potentially costly challenges, not just in terms of penalties and professional costs, but also in terms of the impact on senior management time. Essentially, we can ensure a speedier and more efficient resolution than would otherwise be the case.
Putting together well-argued and documented responses to challenges by tax authorities, and robust economic support of existing principles and prices, is key. This may include preparing and pursuing Advance Pricing Agreements (APAs), or helping our clients to resolve double taxation issues that may derive from transfer pricing controversy by taking the case to Competent Authority under the terms of a relevant double tax treaty or to look for mutual agreement under the European Arbitration Convention.
Global reach
BDO is (by some margin) the fifth largest accountancy network of its kind in the world, providing global reach and strength in depth. This allows us to bring together both the local and global knowledge needed to help international companies find tax-efficient ways of meeting their obligations. BDO Member Firms employ almost 100 transfer pricing professionals from 12 centres around the world, supported by thousands of tax practitioners, including tax specialists, economists, analysts, valuers and lawyers.
This global resource of economists and tax specialists means that we have both the international and local know-how to compile and analyse comparable data, understand the local regulations, and have the industry and country expertise you need.
Accessibility, transparency and responsiveness
We pride ourselves on being accessible to our clients, responsive to their needs, and being transparent in dealing with them. Our proprietorial web-based software allows our clients to monitor in real time the transfer pricing work we undertake for them, and allows us to control the process of collating information for the purposes of our work and to prompt clients on developments and inform them when pre-determined milestones are met.
Partner-led
Our service is genuinely partner-led. Our partner to staff ratio of nine to one means you will receive significantly more individual partner and senior staff attention than many of our competitors can offer. One of our core values is our commitment to building strong and personal client relationships. Our client relationships are more than just business partnerships; we aim to understand people as well as business, and build long-standing relationships based on mutual respect and trust. Our clients say they enjoy working with us and that it feels different from relationships they have with other advisers. We understand the value of difference and believe you will notice that difference too.
Contact us
We have an integrated team of specialist tax advisers and economists with significant experience in addressing and resolving a very wide range of transfer pricing issues, with a network of transfer pricing specialists around the world to help our clients address their global transfer pricing needs worldwide but it is our approach that makes us different.
Find a partner
To find out more you can also contact your local BDO adviser.