Transfer pricing deals with assessment of the prices charged between associated companies forming part of the same group. The Serbian Tax authorities have recently shown increased interest in transfer pricing and failure to comply with legal requirements can result in significant penalties.
Transfer pricing deals with determination of the prices charged between associated companies within the same group (i.e. under common control).
The purpose of a benchmarking study is to identify whether tested related party transactions comply with the arm’s length principle by identifying and using sources of comparable information about companies, prices and margins.
The obligation of the taxpayer to keep transfer pricing documentation is derived from this disclosure requirement.
